Micklethwait / Dimond Driven to the Brink

Why Corporate Governance, Board Leadership and Culture Matter
1. Auflage 2017
ISBN: 978-1-137-59053-4
Verlag: Palgrave Macmillan UK
Format: PDF
Kopierschutz: 1 - PDF Watermark

E-Book, Englisch, 255 Seiten

Reihe: Business and Management

Driven to the Brink is a collection of short stories about corporate disasters and how inadequate governance and flawed culture caused a massive destruction of shareholder value. Look at any major corporate meltdown and two factors emerge: a failure of corporate governance and a culture where short-termism and greed are rewarded and risk is encouraged to flourish unchecked. 

Two years before the latest crash, Alicia Micklethwait co-wrote the best-selling Greed and Corporate Failure which examined some of the high profile corporate disasters of the early years of the 21st century. Sadly those lessons were forgotten.  Companies have continued to be Driven to the Brink of disaster. 

Now, with co-author Patty Dimond, they examine what we must learn this time around. Drawing on in-depth case studies of the Libor scandal, Olympus, Co-op, Kids Company and others, Dimond and Micklethwait ask what have we learned and more importantly, what can we do to prevent these disasters from happening again?

They also examine the large, emerging and less widely understood world of Corporate China with detailed discussion of the Lixel and Glaxo frauds. On a positive note, staying with China, they look at the story of Alibaba and ask is an ethical culture enough to protect shareholder rights?

Alicia Micklethwait is a graduate of the University of Oxford, a member of the Chartered Institute of Management Accountants and has an MBA from IMD. She is CFO of a technology start-up company and has held senior accounting and commercial positions in multinational manufacturing companies in London and Brussels. Alicia has taught accounting and finance at several European business schools and in China and co-wrote Greed and Corporate Failure together with Professor Stewart Hamilton.Patricia Dimond has 25+ years of board level experience in consumer markets in London, Geneva, New York and Toronto and is a McKinsey Alumni.  She is currently involved in early stage Investment and fund management.  She is a CFA, a member of the Institute of Chartered Financial Analysts, and has served on the Board of the Swiss CFA society.  Patty graduated from Canada's Richard Ivy School of Business, with an HBA and has an MBA from IMD, Switzerland.  She qualified as a chartered accountant (CA) working with Deloitte Haskins and Sells.

Autoren/Hrsg.

Micklethwait, Alicia

Dimond, Patricia

Inhaltsverzeichnis

1;Foreword;6
2;Acknowledgements;9
3;Contents;10
4;About the Authors;12
5;Praise for Driven to the Brink;13
6;1: Introduction;15
6.1; Companies Do not Fail, Corporate Boards and Leadership Teams Do;17
6.2; Independent Thinking is the Greatest Value the Board can Add;18
6.3; The Trouble with Dominant CEOs;19
6.4; Board Oversees Strategy and Risk;20
6.5; A Slovenly Approach to Risk Management is a Common Theme;21
6.6; Board Oversees Culture: Culture Defines Leadership;22
6.7; A Productive Ethical Culture must be Part of a Risk-Management Strategy;23
6.8; The Stories that Follow;26
7;2: Enron: Launch to Boom and Bust, 1985–2001;29
7.1; The Creation of Enron and Its First Ten Years;31
7.2; Introducing the Dream Team...?;34
7.3; And then there was the Board;35
7.4; The Enron Culture: ‘Rank or Yank’;35
7.5; Global Energy Provider and Trader to Ponzi Scheme, 1994–2001;38
7.6; The Most Creative Financial Officer of the Year: Where there is Smoke there is Fire.;41
7.7; Going Off-Balance Sheet;42
7.8; The Beginning of the End;45
7.9; The Powers Committee Post-Mortem;47
7.10; Ineffectual Board Oversight: Failure in Strategy, Risk Management and Culture;48
7.11; A Few Selected Highlights from the Enron Story;51
8;3: The Banking Crisis: Born of Dreams, Fuelled by Bad Behaviours;53
8.1; ‘The Blood of the Global Economy has Begun to Freeze Right from its Heart—The United States’;55
8.2; The Pursuit of Happiness: Let the Good Times Roll;56
8.3; Cracks Began to Form: The Unravelling;59
8.4; The Aftermath;61
8.5; Crisis in the UK Started with the ‘Run on the Rock’;62
8.6; London’s Financial Markets Transformed Through ‘Big Bang’;63
8.7; The Good Times in the UK;64
8.8; The Unravelling in the UK;65
8.9; The Aftermath in the UK;68
8.10; Canada: Obama Adviser Looks to Canada’s Financial System34;69
8.11; The Good Times in Canada;70
8.12; Canada: Tripped but did not Fall;71
8.13; So What did We Learn from this GLOBAL Crisis: Highlights of Regulatory Reform;73
8.14; What Role did Inadequate Corporate Governance and Flawed Culture Play?;74
8.15; A Productive, Ethical Culture must be Part of a Risk Management Strategy;76
8.16; Moving Forward;76
8.17; A Few Selected Highlights from the Banking Crisis Story;77
9;4: Global Banking: Will the Scandals Never End?;81
9.1; Libor: Rigging Interest Rates on a Grand Scale;82
9.2; Early Days of Libor;83
9.3; Credit Ratings Encouraged Banks to Lowball Submissions;85
9.4; Rigging Rates for Personal Profit;88
9.5; Regulators Moved In;93
9.6; New Scandal Emerges Hard on the Heels of Libor: FX Manipulation;94
9.7; ‘The 3 Musketeers’ and ‘the Cartell’ Formed to Manipulate the Fix;96
9.8; Out in the Open;97
9.9; Where were the Systems and Controls to Prevent this?;98
9.10; ‘When Bankers Become Detached from End-­Users, Their only Reward Becomes Money’;100
9.11; Perverse Incentives;101
9.12; Amoral Focus on Profit;102
9.13; When Bad Behaviour is Ignored it will Become Entrenched;104
9.14; A Few Selected Highlights from the Global Banking Story;104
10;5: Olympus: Management was Corrupt at Its Core;109
10.1; Early Days;110
10.2; Appreciation of the Yen Led to Financial Engineering;111
10.3; Hiding Losses in Tokkin;112
10.4; Tobashi: ‘Flying Away’;114
10.5; Final Leg of Tobashi Scheme: Three Small Companies;115
10.6; Gyrus Acquisition: Record-Breaking Advisory Fees;117
10.7; News Crept Out;120
10.8; The Fallout;125
10.9; Corporate Governance Failings;126
10.10; Japan’s Corporate Governance;129
10.11; A Few Selected Highlights from the Olympus Story;130
11;6: The Co-operative: CEO Resigns amid Turmoil and Calls for Reform;133
11.1; The Co-operative Movement has International Significance;134
11.2; The Co-operative Group Dates Back to Rochdale, 1844;135
11.3; Food Retailing: Our Coverage is Incredible, with a Food Store in Every UK Postal Area6;136
11.4; And then Co-op Buys its Rival Somerfield for £1.57 Billion;137
11.5; The Co-op Bank: Focused on Future Growth, financial statement cover, 2010;139
11.6; A Disastrous Year, 2013;143
11.7; The Group Experiences a Significant Shake-Up;144
11.8; The Co-op Bank under the Microscope;145
11.9; Independent Review of Governance, May 2014;147
11.10; The Co-operative Group: Here for You for Life?;149
11.11; A Few Selected Highlights from the Co-operative Group Story;150
11.12; Notes;151
12;7: Kids Company: Passion Overruled Reason;153
12.1; The Charismatic Founder and CEO;154
12.2; The Foundation of Kids Company: Meeting an Urgent Need;155
12.3; Precarious Funding: Ten Days of Reserves;157
12.4; Funding: Donations and Government Grants;158
12.5; Inadequate Monitoring by Government and Trustees;161
12.6; The Trouble with Kids Company;163
12.7; What Impact did the Charity Actually have?;164
12.8; A Dominant CEO and a Complacent Board?;165
12.9; And What of Risk Management?;167
12.10; Duties of Trustees;167
12.11; A Few Selected Highlights from the Kids Company Story;169
13;8: China: Land of Opportunity but Beware of Landmines;171
13.1; Google vs LinkedIn;173
13.2; Bribery is Often ‘an Unspoken Rule’ in China;174
13.3; Lack of Systems and Institutions to Keep Corruption in Check;177
13.4; Guanxi: You Got My Back, I Got Your Back;178
13.5; GlaxoSmithKline: Doing Business in a ‘Connected’ Society;179
13.6; ChinaWhys: Illegal to Purchase Personal Information;183
13.7; Fraud and Accounting Scams;184
13.8; Lixil and Joyou: Failed Due Diligence;188
13.9; Caveat Emptor—Due Diligence is Vital;191
13.10; A Few Selected Highlights from the China Story;192
14;9: Alibaba: Largest Etailer on the Globe a Mere 15 Years On;195
14.1; Building the World’s Biggest Internet Company: Alibaba’s Explosive Growth;197
14.2; The Spirit of Guanxi: Strong Relationships Accelerated Alibaba’s Growth;198
14.3; Much of Alibaba’s Growth was Organic or Came from Small Acquisitions;200
14.4; Culture is Often a Profound Illustration of the Values of Its Founder(s);202
14.5; No Matter how Big, it will Always be a Start-Up with a Customer-Centric Approach;204
14.6; Culture is Shaped through Behaviours that are Reinforced through Acceptance;205
14.7; Being Accountable for the Outcomes of a Company’s Actions and Inactions;206
14.7.1; Online Scandal in China: Alibaba and the 2,236 Thieves16;206
14.8; The Alibaba Group’s Corporate Governance and Control;207
14.9; The SINA Structure, Getting Around Chinese Regulation on Foreign Ownership;207
14.10; A Structure that Leaves Shareholders Vulnerable;209
14.11; Increasing Shareholder Risk, Separation of Ownership and Control;209
14.12; What About the Quality of Board Oversight?;210
14.13; Alibaba’s Performance since the IPO;211
14.14; Is a Strong Ethical Culture Enough to Protect Shareholders?;212
14.15; A Few Selected Highlights from the Alibaba Story;213
15;10: Conclusion;215
15.1; Some Progress has been Made;216
15.2; Shareholders have a Role to Play;218
15.3; Independence in a Director is a Valuable Trait;219
15.4; Independence is Essential to Discharge the Duties of the Director;221
15.5; Avoid the Pitfalls of a Dominant CEO;223
15.6; Risk Management is a Primary Responsibility of the Board;224
15.7; A Productive Ethical Culture is an Important Part of a Risk-Management Strategy;226
15.8; Remuneration and Organisational Structure Drive Behaviours;227
15.9; Bad Behaviours Need to be Identified and Addressed;229
15.10; Final Word;230
16;Glossary;234
17;List of Abbreviations;243
18;Index;246