Tuesday Trifecta

Tuesday’s WSJ had three articles of note.

“Wells Slams Former Bosses’ High-Pressure Sales Tactics,” The Wall Street Journal, April 11, 2017 A1.  Former CEO and board members failed to adequately supervise, leading to the account-cramming scandal.  A proxy advisory firm recommends voting against 12 of bank’s directors.  Not reported lawsuits against the directors at the time of the scandal, or since. Yet.

“At Barclays, a Probe of the CEO,” The Wall Street Journal, April 11, 2017 A1 (linking to an article on B1).  UK regulators join the probe of the current CEO’s attempt to learn the identity of the author of a letter complaining about the hiring or one of the CEO’s buddies.  Barclays is investigating.  Watch this space.

A United Passenger’s Treatment Stirs Furor,” The Wall Street Journal, April 11, 2017 A1.  United is pilloried after a man is dragged off a plane being operated by one of United’s contractors.

Takeaways (different from Lessons Learned):

  • most major business scandals/crises are attributed to a management failure, of one type or another (see The Lessons of Longford).
  • CEO’s need assistance to prevent them from doing dumb stuff.
  • You can be liable when one of your contractors ignores your prime mission in a customer-facing business.

Interestingly enough, all of these would be good teaching cases in a course on crisis management.

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Filed under Board, Compliance, Compliance, Controls, Corporation, Culture, Culture, Directors, Duty, Employees, Governance, Internal controls, Oversight, Oversight, Supervision, Vendors

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