Reporting, vel non

Does your radar go wild when someone suggests delaying the report of information?

“Sunrun Sales Data Seen as Skewed,” The Wall Street Journal, May 23, 2017 B1.  In the run-up to the company’s IPO, some managers were told by their managers to hold off on reporting a number of canceled contracts.  Reporting this information would have reduced the sales numbers, as the canceled contracts were a large percentage of total orders.

What does it say about a culture where the bosses ask managers to do this type of thing?  And no one says, “No”?  Was no one bright enough to connect the dots?  What else is suspect?  Are employees clueless as to their common law duties to report wrong-doing or deviations from company processes?


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Filed under Accuracy, Compliance, Compliance, Controls, Culture, Data quality, Duty, Employees, Governance, Internal controls, Management, Managers, Oversight, Supervision, To report

You manage what you measure

If the Board asks how much the company paid for something, “I don’t know” isn’t a good answer.  Neither is “We can’t track that today.”

“Algorithms Help Calpers Tally Fees,” The Wall Street Journal, May 23, 2017 B1. The question was how much the pension plan had paid private-equity managers in performance fees.  It turns out the answer was $3.4 billion, over 25 years, with $490 million last year.  Answer was derived using algorithms.

“It took five years to develop a new data collection system that requires private-equity managers to fill out various templates describing their various fees.”

How comforting – a self-graded exam for $3.4 billion in fees.

What’s information worth?  How can you manage without it?  How did they?

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Filed under Access, Analytics, Board, Collect, Controls, Corporation, Data quality, Directors, Duty, Governance, Information, Internal controls, Management, Operations, Oversight, Oversight, Protect information assets, Third parties, Use, Use, Value, Vendors

Texas Administrators

Soon to be signed into law is a bill holding school administrators, superintendents, and principals criminally liable for failing to report teachers who commit “inappropriate acts” with students.  The offending teachers are already potentially liable.

“Texas Measure Targets Improper Teachers, The Wall Street Journal, May 22, 2017 A3.

Surprising it wasn’t the law already.  Mr. Bumble was right:  the law is a ass.

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Filed under Communicate, Communications, Controls, Duty, Employees, Governance, Government, Internal controls, Management, Managers, Oversight, Supervision

Digging out

I was otherwise engaged last week and missed posting.  Here are some catch-ups.

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Filed under Accuracy, Board, Communications, Compliance, Compliance, Content, Controls, Corporation, Directors, Discovery, Duty, Employees, Governance, Government, Inform market, Inform shareholders, Internal controls, Investor relations, Oversight, Privacy, Protect assets, Protect information assets

Where does one start?

Two front-page items today relating to information and governance and compliance, or some combination thereof.

Trump Shared Secrets With Russians,” The Wall Street Journal, May 16, 2016 A1.  President Trump shared  with the Russians “sensitive intelligence” received from an ally.  May have compromised the source.

“Hack Probe Zeroes In on How Virus Invaded Networks,” The Wall Street Journal, May 16, 2016 A1.   WannaCry ransomware infects various networks worldwide.  Similar to an NSA hack, or are you still using XP?

Regardless whether the President shared actual sources and methods, or just enough to figure them out, this bears scrutiny.  What impact (cost) will this have on future intelligence sharing by allies?  Who in your organization has access to secret stuff, and how well do they manage it?

As for WannaCry, are we really only secure as our weakest link?  Lots and lots of links.



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Filed under Access, Controls, Duty, Duty of Care, Governance, Government, Information, Interconnections, Internal controls, IT, Protect assets, Security, Third parties, Value

Speaking of Culture

Another company much in the news of late: Wells Fargo.  Account cramming over a period of years.  To get bonuses.  Shearman & Sterling report.

“Wells Investigated Whether Executives Steered Business,” The Wall Street Journal, May 11, 2017 B10. Three executives in private banking business are reportedly fired or suspended.  The allegation is that some clients were channeled away from people in the bank “who may have been better equipped to handle certain client needs.”  Maximizing bonuses may be at issue; apparently, the best interests of the clients were subordinate.  Following internal processes and procedures apparently is also optional.

This is what we know this week.  What will we know next week?  How deep does the rot in ethics and compliance go? What messages are the remaining employees getting?  The Board is still in place.  Who’s accountable?

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The CEO tries not once but twice to get the company security people to investigate who raised a stink over one of the CEO’s buddies getting hired.  The CEO gets a formal reprimand and gets his bonus docked.  Now the Chairman of the Board supports the CEO.

“Barclays Chairman Backs CEO Amid Shareholder Calls for Firing,” The Wall Street Journal, May 11, 2017 B3.  Barclays also got hit for $97 million to settle an over-billing claim.  The CEO also tried to intervene with one of the bank’s major clients that was in a dispute with the CEO’s brother-in-law.  Nearly all the shareholders voting at the annual meeting also supported the CEO (some abstained).

The WSJ article ends with

On Wednesday, the SEC said Barclays improperly recommended more expensive share classes, charged fees to clients for due diligence and monitoring services that weren’t performed and collected extra mutual-fund sales charges and fees.

What does this say about the culture (a) on the Board, (b) for the Barclays shareholders, and (c) the employees see?  How does the SEC (and other regulators) view them?

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