Corporate Board articles from May 2002

Corporate Board archives from May 2002

Has corporate governance let us down?
May 1, 2002... In the January/February 2000 issue of The Corporate Board, Vanguard Group Founder John C. Bogle condemned the "silence of the mutual funds" that was allowing corporate governance to run off the rails. Now, after a tech market meltdown and the...

Audit history: how we got to Enron.(corporate governance)
May 1, 2002... While the Enron debacle is not the first instance of governance breakdown and financial mischief, it may be the one that forces us to look at how our confused, troubled national auditing system needs reform. Norman Friedland finds that Enron,...

Playing the financial numbers game.
May 1, 2002... Financial fraud in a company occurs when someone in management decides to tidy up results by pushing "aggressive" accounting over the line into outright fraud. Yet, as the authors show, this line can be a vague one, and the market rewards for...

Internal or external auditors?
May 1, 2002... One factor in the Enron scandal was too much out soureing of the firm's internal audit function to the outside auditor. Making your board an informed player in audit oversight requires knowledge of the complementary, but distinct roles played...

D&O coverage after Enron.(director and officers insurance coverage)
May 1, 2002... With high-tech industry stumbles, the economic slowdown, and a steady increase in tort claims, D&O insurance has grown far more expensive over the past year. After Enron, though, prices are headed through the roof, and coverage will be...

A new fraud standard is proposed for U.S. auditors. (Audit).
May 1, 2002... The Auditing Standards Board of the American Institute of Certified Public Accountants (AICPA) in March issued expanded fraud guidance for U.S. auditors to follow in their efforts to detect material misstatements due to fraud. According to...

Directors and auditors support wholesale changes in financial reporting. (Audit).(corporate America)
May 1, 2002... Many corporate directors and the internal auditors who serve them support wholesale changes in America's financial reporting and monitoring systems in the wake of Enron's bankruptcy, according to surveys conducted jointly by The Institute of...

Independence has grown more vital in the boardroom, says ASCS. (Boardroom Composition).(American Society of Corporate Secretaries)(Brief Article)
May 1, 2002... Over seventy-five percent of companies responding to an American Society of Corporate Secretaries' (ASCS) survey of board practices indicated that they take independence into account when selecting outside director candidates. This result shows...

CEO pay for 2001 showed its first decline since 1993. (Compensation & Recruitment).(chief executive officer)(Brief Article)
May 1, 2002... Buffeted by a declining stock market and sagging corporate performance, overall pay for chief executive officers at some of the largest U.S. companies fell four percent in 2001, to $10.46 million, according to compensation consultants Pearl...

Board pay grew by 10 percent in 2001. (Compensation & Recruitment).
May 1, 2002... Board compensation among the 200 largest U.S. corporations grew 10 percent to an average $152,626, according to an analysis of 2001 proxies by Pearl Meyer & Partners. Directors received a record 62 percent of their pay in equity, with the use...

High governance standards are proving crucial to attracting capital. (Corporate Responsibility).
May 1, 2002... Companies seeking to attract funds from the global investment community today must demonstrate the highest standards of governance. In tomorrow's markets, capital will only be available to those companies that meet internationally accepted...

Bush administration announces plan to improve corporate responsibility. (Disclosure).(George W. Bush)(Brief Article)
May 1, 2002... In March, President George W. Bush outlined a ten-point plan to improve corporate responsibility and help protect America's shareholders. According to the White House, the proposals are guided by the core principles of: providing better...

Employers must act now to rein in soaring health care costs. (Pensions & Benefits).(Brief Article)
May 1, 2002... According to Towers Perrin's 2002 Health Care Cost Survey, double-digit increases in health care costs are expected to continue over the next few years. "Employers should look ahead to the years 2004 and 2005 and ask themselves how much are...

CFOs are optimistic about the economy and corporate earnings. (Strategy & Finance).(Chief financial officers)
May 1, 2002... Chief financial officers of U.S. companies overwhelmingly believe that the U.S. economy will be back to normal in the coming twelve months, and across the board they expect their companies to report increased earnings. In addition to economic...

Five years ago. (Retrospectives).
May 1, 2002... Institutional investors now have enough power but not enough economic incentive to make judgments on management beyond a very small level. So they have to rely upon the board of directors. The central idea of corporate governance is an engaged...

Ten years ago. (Retrospectives).
May 1, 2002... Things like paper trails, confrontation, recorded votes, the things that lawyers love, are not the way boards work in the real world. The board actually counsels with the CEO in the hall or over the phone. Those conversations are far more...

Books Received. (In Review).(Book Review)
May 1, 2002... X-Engineering the Corporation. By James Champy. Warner Books. $25.95. Extending his Reengineering the Corporation franchise, corporate guru Champy reaches out to urge a wider mindset for business that includes suppliers and customers as core...

Articles & Speeches. (Spoken & Written).
May 1, 2002... The Enron audit committee may have been exactly what the stock exchanges had in mind in December, 1999, when they required that members demonstrate financial know-how-but the expertise may have been out of date following the changes Enron went...

Recent board elections. (Directors' Register).
May 1, 2002... Acacia Research Corporation has elected to its board G. Louis Graziadio III, chairman and chief executive officer of Second Southern Corp. Alcoa Inc. has elected to its board Carlos Ghosn, president and chief executive officer of Nissan...

Roderick Hills: shaking up audit committees. (Conversations).(Interview)
May 1, 2002... At a time when board audit committees (and auditing in general) are under a cloud, it pays to talk with the man whose philosophy is "the outside auditor needs to be more scared of the audit committee than of the CEO." Rod Hills has the vitae to...