We have featured Toshiba several times this year in our new ACG Report, and the twists and turns have been fascinating. The likely end result is both surprising and at the same time unsurprising, though the long term implications for governance could be ground-breaking. This post is taken from the latest issue of the report which is available free to subscribers.
Kobe Steel is one of the pillars of the Japanese industrial establishment. In a few short weeks in October, its share price suffered a disastrous drop of some 40% following revelations by the company that over some years it had routinely produced fake quality control data. We look at its code of conduct, apply Japan’s Corporate Governance Code and our Golden Rules and suggest measures that should now be taken to stop this happening again.
ESG is now mainstream and holistic Corporate Governance now drives brand value. But exactly what is ESG? We look at its origins in Responsible Investing and the principles thereof, various interpretations of ESG and its evolution towards complete acceptance by the investment community of the effect of holistic corporate governance on sustainability (in the widest sense) and hence brand value.
We have written often, and at length, about the imperative of taking a holistic approach to Corporate Governance, and that balancing the interests of primary stakeholders in formulating the Goal of the organisation is key to this. In UK company law, we can see that this is now effectively explicit in the statutory duties of directors.
We discussed active versus passive investment in an article last year, but what about impact investment? It comes after socially responsible investment (SRI) and environmentally sound, socially beneficial and excellent governance investment (ESG). Is it more than just another marketing tool for investment managers, and how does it rank in corporate governance compared with traditional investment?
Our latest review of corporate governance developments in Australia places charities in the spotlight, following another scandal involving underpayment of so-called “chuggers” (street collectors or “charity muggers”), checks progress in the banking sector since the parliamentary review and comments on the expenses furore that has led to the resignation of the health minister. By Malcolm Sealy, Australia Correspondent.
On 3 October 2016 a Parliamentary Committee Inquiry, set up by the Liberal Party as a counter to a Labor call for a Royal Commission, began to question all four CEOs of the Big Four Banks (Westpac, ANZ, NAB, Commonwealth), on separate days. Was this a genuine effort to change banking culture or a political box-ticking exercise? Our Australia Correspondent, Malcolm Sealy, discusses the issue.
A recent article by Professor Alfred Rappaport in the Financial Times defended his very influential and widely followed philosophy of the primary importance of the pursuit of shareholder value. This has come under increasing criticism in recent years, as the concept of a more balanced stakeholder approach has gained wider acceptance, and particularly as capitalism itself has come under fire since the 2008 financial collapse. So we thought it would be interesting to go back to the source of the controversy and review Prof. Rappaport’s defining book, Creating Shareholder Value, thirty years after its publication, in the light of current views about corporate governance, and see whether we agreed with Prof. Rappaport’s self-justification.
Following the shock result of the Brexit referendum and the subsequent collapse in the value of the pound, the next shock – at least in technology circles – was the announcement that Japanese telecoms and internet giant, Softbank, had made an agreed offer to buy leading UK chip designer, ARM.