In a front-page story in today's Wall Street Journal we learned that Mark  Zuckerberg the founder and CEO of Facebook never consulted with his board of directors before negotiating a $1 billion deal to acquire Instagram. Normally a board of directors is comprised of individuals with disparate skill sets who advise and consult with the CEO on corporate issues including strategy. A visitor to my class on restructuring at Northeastern University, a former bankruptcy judge, remarked once that in his opinion most bankruptcies are caused by CEOs who ignore their board of directors. Obviously no one would suspect that Facebook is a likely bankruptcy candidate; but that does not mean that Mr. Zuckerberg was right in what he did.

I suspect that his behavior was an unintended consequence of his previous success. My friend the bankruptcy judge explained that successful CEOs had to fight naysayers on their way to success. He felt that this caused many of them to assume a me against them mentality - even when they're all on the same team such as with the Board of Directors. I don't think Mr. Zuckerberg had too long or too arduous a battle on his way to Facebook success. In fact, I suspect this unintended consequence derives from his arrogance as a result of rapid and unprecedented success.

This unintended consequence is not going to bankrupt Facebook. After the company goes public however, public shareholders may object to his handing out 1% of their company for an acquisition of a firm with no revenues and no profits. After all, Instagram was not the only photo sharing and photo manipulating app out there.