Two interesting stories on page B1 relating to governance:
“Ford Official Fired for Misconduct,” The Wall Street Journal, February 22, 2018 B1. Top executive fired for unspecified bad conduct.
“Disney Producer’s Behavior Criticized,” The Wall Street Journal, February 22, 2018 B1. Successful producer may act and speak inappropriately, but is still running the high-profile “Frozen” production.
How important is context? One would think that the entertainment industry would be more sensitive than other industries in avoiding any hint of inappropriate (the PC term) behavior, and Disney in particular.
How does your company manage its culture? Does it enforce the rules against top managers, or big money producers? What does the Board say, both now and when something goes wrong (or is discovered) later? Are violations and punishments publicized internally?
Filed under Board, Communications, Compliance, Compliance, Controls, Corporation, Culture, Culture, Directors, Duty, Duty of Care, Employees, Governance, Inform market, Inform shareholders, Internal controls, Oversight, Oversight, To report
The news media has an obligation to verify its reports. Is YouTube “news media”?
“YouTube Mistakenly Promoted False Video,” The Wall Street Journal, February 22, 2018 A4. YouTube apologizes and removes video suggesting an alleged witness to the Parkland shootings was an actor and not a student.
Is YouTube merely a carrier of content provided by others or does it’s role in curating content make it liable if the curating yields misleading results? Does YouTube have the protections available to The New York Times? Should it? Who decides?
“‘Success Theater’ Masked Rot at GE,” The Wall Street Journal, February 22, 2018 A1. GE’s CEO may have been too optimistic. “This culture of confidence trickled down the ranks ….”
If the top boss has rose colored glasses, that view apparently permeates the organization. If he or she reacts badly to bad news, do people stop bring bad news?
One principle of compliance is that the tone at the top matters. Does the CEO’s tone build filters that prevents him/her getting the facts? Are the resulting wounds self-inflicted? Where was the Board?
Filed under Data quality, Governance, Communications, Controls, Internal controls, Culture, Board, Oversight, Oversight, Access, Duty, Employees, Accuracy, Managers
You discover a product flaw. One of the first things on your crises management list of things to do is notify your biggest (or best) customers.
“Intel Told China of Flaw Before U.S.,” The Wall Street Journal, January 29, 2018 A1. Intel tells its Chinese customers of a security flaw in Intel chips before telling the US government. Flaws discovered in June 2017. Not disclosed to the market until after a website in the UK reports on them in January 2018.
Who thought waiting to tell the US government was a good idea? Where are they now and what are they doing (and for whom)?
Getting information early increases the value of that information to you. Six months? What happened in the meantime? What did the Board know? Did they approve the communications plan?
Filed under Board, Communications, Corporation, Directors, Duty, Duty of Care, Governance, Inform market, Information, Oversight, Security, To report, Value
Which is better? Government regulation or market regulation? I guess we’ll find out.
“FCC Reverses Rules on Net Access,” The Wall Street Journal, December 15, 2017 A1. The move reverses the utility-based rules that were previously in place.
Were the rules neutral before, or are they neutral now? Does the government control how we get our information, or do market forces? How much does it matter?
“Chicago Sues Uber For Lag in Reporting Data Hack,” The Wall Street Journal, November 28, 2017 B4. Following the disclosure of the year-old breach of 57 million accounts, Uber is sued for consumer fraud and deceptive business practices, among other things.
There is the breach. And then your response to the breach. And then the regulators’ and the customers’ and the shareholders’ response to the breach.
Filed under Communications, Compliance, Controls, Corporation, Directors, Duty, Duty of Care, Employees, Governance, Information, Internal controls, Investor relations, IT, Oversight, Protect assets, Security, Supervision, To report, Value
“Wells Fargo Fires A Top Official, The Wall Street Journal, November 18, 2017 B1. Head of commercial lending canned because he said bad things to a fellow employee about regulators (and how they were affecting golden parachute payments) .
Think about that. He didn’t write it down; he just said it. Not outside the company, even.
True, his firing may have been expedited by all the other legal issues Wells Fargo has been having. But he may not have gotten much of a parachute.
Information controls apply to unwritten information, too.
Filed under Communicate, Communications, Compliance, Controls, Culture, Definition, Duty, Employees, Governance, Information, Internal controls, Management