Corporate America

[Blue]

What is your opinions on corporate America? What could be done to earn the trust back, and maintain that trust?


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[Sterling]

A good start would be passing Paul Sarbanes' corporate-reform bill, which would introduce a number of sensible measures such as heavy restrictions on the additional work auditing firms can do for a client, accounting stock options as business expenses, and restrictions on senior executives dispersal of stock holdings while still in office.

In addition, it would be a useful measure to force a greater representation of independent non-executive directors on boards, and in particular force those independent directors to regularly meet without the executive directors present. This would cut the pressure put on independent directors by executives, and help to eliminate the 'country-club' rubber-stamping atmosphere that exists in some boardrooms.

Sadly, it looks like the US government, and President Bush in particular, regards measures like this as too radical. They prefer to subscribe to the 'few bad apples' theory, rather than address the underlying structural causes. I think their calculation is that tub-thumping speeches about throwing bad executives in jail will keep the public happy, while not putting structural measures in place will keep their corporate bankrollers happy.

For all his free-market rhetoric, President Bush is really the worst kind of special-interest-group lead president. He bangs on about free global trade, but then imposes (illegal) 30% import tarriffs on steel, as well as tarriffs on softwood lumber, and endorsement of protectionist measures for the textiles industry. In short, Bush follows sound economic principles when it suits him, his coporate backers, and short term electoral needs, and is not really interested in solving the nations structural economic issues.

The Economist this week has a couple of excellent editorials on the subject.

[SysLord]

Mm tough question. On the one hand I am inclined to say that this will blow over quickly once people start seeing good money in their pockets again as the economic climates pick up. I am sure alot of people will be woed by GW's feeble and half-hearted attempts to do something about the recent corporate scandals. On the other hand there's the shattered dream of quick riches. High time to rethink how stocks influence people's lifes and business practices.

[Redallnite]

I have been out of "corporate" world for about six years, I remember seeing alot of that bullshit!! I couldn't stomach it any longer - my family couldn't stand me worring about that bullshit then... I knew this would happen it was only a matter of time. I have had calls from long time friends about losing their jobs because of "creative accounting" not that they wanted to do it but because they were told to do it.....

This time the shit is going up river!!!!! It's about damn time!!:mad:

[GLADIATOR]

Originally posted by Redallnite
I have been out of "corporate" world for about six years, I remember seeing alot of that bullshit!! I couldn't stomach it any longer - my family couldn't stand me worring about that bullshit then... I knew this would happen it was only a matter of time. I have had calls from long time friends about losing their jobs because of "creative accounting" not that they wanted to do it but because they were told to do it.....

This time the shit is going up river!!!!! It's about damn time!!:mad:

I agree fully with you Redallnite. This has been a disaster waiting to happen. Both corporate greed and poor statutary auditing is to blame. It will not blow over so quickly, possible now holding growth back till 2003.

However I do believe that it will be stopped in future CEO's will be made accountable, auditers will be too nervous to hide 'shady' deals.

There is so much we can easily do to stop this, for a start 'offshore' accounts should be made illegal.

Anyway, I am not suprised, only that it's taken so long to expose.

[Blue]

MCI Worldcomm has filed bankruptcy; bigger than Enron.

[SysLord]

Originally posted by GLADIATOR


I agree fully with you Redallnite. This has been a disaster waiting to happen. Both corporate greed and poor statutary auditing is to blame. It will not blow over so quickly, possible now holding growth back till 2003.

However I do believe that it will be stopped in future CEO's will be made accountable, auditers will be too nervous to hide 'shady' deals.

There is so much we can easily do to stop this, for a start 'offshore' accounts should be made illegal.

Anyway, I am not suprised, only that it's taken so long to expose.

Fully agree with your Gladiator. It's time personal greed gets out of the way of good business ethics.