Corporate Governance

Citigroup eats humble pie

14 Sep 2004

The world s largest bank has said it regrets its controversial trade in government bonds. The proprietary trade may have made money. But it irritated clients who could in theory withhold more more valuable business from the bank.

BNL capital hike could hamper M&A hopes

8 Sep 2004

The Roman bank could try to dilute a group of rebel shareholders linked to old suitor MPS by launching a capital increase of up to E1bn. Were the rebels to be outflanked, minority shareholders betting on a prompt bid would have to bide their time.

Old raiders try new tricks

8 Sep 2004

Carl Icahn and Vincent Bollore are back in the saddle taking big blocks of stock and terrorising company managers. The difference is that now they are wearing the whitehats of the shareholder value movement. It may be a more viable longterm strategy.

Biotech isn’t an exception for capital raising

8 Sep 2004

The UK government has appointed Paul Myners, the chair of M&S, to examine relaxing preemption rights for biotech companies. Creating different capital raising rules for favoured sectors sets a bad precedent.

EDF’s boss to lose job – reports

6 Sep 2004

This is probably a precondition for a successful privatisation of the French utility. Roussely destroyed billions through empire building. The errors of the past will make privatisation difficult. But they also show the necessity of market discipline.

Lord Black vies with Tyco boss for greed Oscar

1 Sep 2004

Denis Kozlowski and his $15,000 umbrella stand still have an edge, but Hollinger's report into Black's expenditure looks pretty awful. Given the amounts of money involved, Black and his fellow directors deserve to face a Tycostyle grilling in the courts. Dennis Kozlowski and his $15,000 umbrella stand still have an edge, but Hollinger's report into Black's expenditure looks pretty awful.

Alitalia’s unions drive it towards bankruptcy

31 Aug 2004

This may not be as topsyturvy as it sounds. The unions calculate the Italian government still hasn t the stomach for largescale job cuts. But if Alitalia is to avoid going bust, the government needs to persuade the unions this won t be the case.

Investors shun hedge-fund jamborees

30 Aug 2004

They have got bored of the big capital introduction parties thrown by prime brokers to help hedge funds raise money from them. So prime brokers are now beginning to offer a more sophisticated matchmaking service. The question is whether they will make any money.

RBS in vicious circle after Charter One deal

29 Aug 2004

It will be a year before the UK bank can show it s delivering the promised revenue synergies from its latest US deal. In the meantime, the poor performance of RBS shares since the deal is likely to continue. RBS s next deal will have to wait.

Gazprom threat does Russia no favours

19 Aug 2004

PostYukos, the government needs a PR coup. And what better than lifting restrictions on foreign ownership of Gazprom stock? Instead, an MP's demand to investigate schemes that allow foreigners to own stock indirectly has spooked investors.

Parmalat sues auditors for $10bn in damages

18 Aug 2004

Whatever the merits of the allegations against Grant Thornton and Deloitte, the lawsuit will send shockwaves though the audit profession. Accountancy firms are far more thinly capitalised than another of Parmalat s legal targets its banks.

FSA ends Collins Stewart probe – unhelpfully

18 Aug 2004

The regulator has found nothing in allegations of impropriety made by an exemployee that justify publicly reprimanding the UK stockbroker. But it has drawn attention to the possibility it may have issued a private warning. It didn t need to do that.

Allianz boss sets good example on pay

17 Aug 2004

Michael Diekmann has revealed a fixed salary of E900,000. That seems small, but he could earn a lot more in bonuses. Other German companies should follow suit. This would encourage greater transparency and avoid onerous legislation. Michael Diekmann, the boss of Germany's largest insurer, has disclosed his salary. But Allianz has not revealed his bonus and options. Allianz should disclose the total sum and other German companies should follow suit. This would avoid onerous legislation.

Swatch buckles under tax evasion allegations

13 Aug 2004

The Swiss watch group's shares initially fell more than 10% on news it was charged with tax evasion. Allegations of a coverup make this case more dramatic than a plain vanilla tax evasion charge. But how bad can it be?

Analysts squeal to FSA on company bullies

12 Aug 2004

Instead of complaining about regulation, investment banks are now proactively encouraging it. But the UK regulator has rejected calls to legislate against companies pressurising analysts into being nice. That s ironic, but correct.

Brandes swivels guns towards Volkswagen

10 Aug 2004

The value fund manager has been buying the carmaker s shares when others have been selling their s. The reason may be that it wants to challenge the company s flawed strategy.

Who should be M&S’s permanent chairman?

30 Jul 2004

Paul Myners would be ideal. He fought Philip Green, so has the biggest incentive to show M&S was right in refusing 400p a share. Having him stay for a year is a reasonable compromise. But it is a shame that M&S has to cast around when the best option is under its nose.

Shell ought to think radical

14 Jul 2004

The oil and gas giant has now hired two investment banks to beef up its corporate governance review. It is a sign that Shell might actually consider overhauling its cumbersome doubleheaded structure. That would be the cleanest solution.

SEC votes for hedge fund registration

14 Jul 2004

Chairman Donaldson had to cast the deciding vote over Republican commissioners, squandering his dwindling supply of political capital. He should devote his efforts to worthier causes, such as increasing freedoms for investors to sack and nominate corporate directors.

M&S boss considers taking options at 400p

13 Jul 2004

Rose shouldn t just consider it; he should do it. Even better would be to accept an exercise price that ratchets up every year. This would amount to Rose putting his money where his mouth is when he says shareholders should reject Green s 400p of cash.