Corporate Governance

WeWork dents the case for private markets

5 Sep 2019

Startups are staying private for longer because money is available with fewer strings. But that can enable poor governance and unrealistic valuations. The stock market, for all its warts, has the edge when it comes to setting prices. The hapless WeWork shows the gap can be wide.

WeWork is wilting under public scrutiny

5 Sep 2019

The office-sharing firm may slash its IPO valuation to less than half the $47 bln of its last funding round. That would demolish management credibility, and still be excessive given its conflicts, cash burn and unproven business model. It shows WeWork belongs in private hands.

Nissan CEO has overstayed a lukewarm welcome

5 Sep 2019

Hiroto Saikawa and others may have padded their pay. The figures appear small compared to allegations levied against Carlos Ghosn, but it hardly matters. Saikawa has not rebuilt credibility or fixed performance at the $25 bln carmaker. Investors have no cause to remain patient.

WeWork governance fixes highlight the unfixable

4 Sep 2019

Co-founder Adam Neumann has handed back $5.9 mln he was paid for trademarks. And the shared-office group has finally hired a woman as a director. Yet such easy repairs only underline the harder-to-reach problems: structurally poor governance, huge losses and impenetrable numbers.

Hotelier bidding war may be Japanese wakeup call

3 Sep 2019

Travel agent H.I.S. ended its unsolicited tilt at Unizo, ceding to SoftBank-owned investment firm Fortress. The unusual hostilities for Japan helped the target’s stock price more than double. This deal, enabled by wider reforms, suggests more value could be hidden in plain sight.

Dan Loeb could give Ray-Bans a better look

26 Aug 2019

The pushy U.S. investor is building a stake in $63 bln EssilorLuxottica, maker of the sunglasses brand and others. Although his plans are unclear, the company has unveiled another big deal despite the lack of a CEO and messy corporate governance. A fresh outside lens may help.

Cigs show challenge of putting stakeholders first

22 Aug 2019

Tobacco companies that were run for customers rather than shareholders would aim to reduce sales of their noxious products. But less scrupulous rivals can undermine solitary socially conscious CEOs. Without collusion or new laws, corporate virtue-talk is mostly a smokescreen.

Viewsroom: WeWork unfurls the red flags

15 Aug 2019

The shared-office provider’s long-awaited IPO filing is packed with pointless life-affirming tropes. But it also details a host of conflicts of interest and other risks that should send investors running. Plus: India’s powerhouse Reliance is building a war chest for dominance.

Hong Kong businesses pick an ill-timed ESG fight

13 Aug 2019

A stock exchange plan to increase disclosure on green issues and governance has met resistance from local firms, wary of extra costs. The city already lags the likes of Singapore on such reporting; protests are hardly adding to its appeal. A corporate victory would be pyrrhic.

India’s bold Kashmir grab raises economic stakes

6 Aug 2019

New Delhi says an abrupt move to end special rights for the disputed territory will aid development. Kashmir could use more state funds and private cash, but gains will be limited without peace. Serious unrest would also hit a $3 trln Indian economy already in the doldrums.

Greece’s new PM needs to avoid banking own goal

1 Aug 2019

The fund that oversees state shareholdings in the country’s four big banks has been a force for better governance. Even so, recently elected Prime Minister Kyriakos Mitsotakis may decide to overhaul its leadership. A changing of the guard now would send the wrong message.

StanChart’s Winters makes best of a weak hand

1 Aug 2019

The emerging market bank is growing, helped by trading revenue and falling impairments. But currency swings, a trade war and rate cuts make Bill Winters’ targets harder to hit. Investors probably shouldn’t begrudge him a salary that's a sliver of what he could have had elsewhere.

SoftBank’s new $108 bln vision is broader, fuzzier

26 Jul 2019

Vision Fund 2 so far lacks endorsement from prior investors Saudi Arabia and Abu Dhabi. It has plenty of heft, though, and less Saudi money might relieve wary investees. Focus is an issue: targeting anything “tech-enabled” gives Masayoshi Son a very long spending leash.

Nissan’s awful earnings deliver a gift to Renault

25 Jul 2019

The Japanese car giant’s 95% drop in quarterly earnings has prompted it to announce 12,500 job cuts and plans to reduce capacity. But boss Hiroto Saikawa has previously underestimated how bad things are. That weakens his hand in resisting closer ties with Nissan’s French partner.

Macquarie is both target and role model on pay

24 Jul 2019

Aussie watchdogs are cracking down on bank remuneration, and a group of shareholders plans to contest Macquarie’s pay at this year’s shareholder meeting. That’s odd, because Macquarie’s practices are pretty sensible – and its rewards pale versus poorer performers on Wall Street.

Fresh attack on China’s zombies can bury some

18 Jul 2019

Beijing officials are on a campaign to kill off moribund companies. Past versions of this familiar horror flick have ended with local authorities keeping state-owned groups staggering along anyway. But a healthier economy and big ambitions make this sequel worth watching.

Miner exits shift coal spotlight to Anglo American

16 Jul 2019

BHP is the latest heavyweight to consider a sale of thermal coal assets. That's sensible given weak prices, pressure from investors and a business that is barely material. Anglo's bigger exposure means a tougher choice - with few buyers, there’s a case for staying the course.

Rio sounds copper warning from Mongolian steppe

16 Jul 2019

The miner's flagship Oyu Tolgoi expansion will be up to 30 months late, and could cost as much as a third more than planned. It’s a fresh blow to a project that has been bruised by local politics. The latest snag is a reminder of why the red metal has become so hard to dig up.

China’s tech funding rut shifts power to investors

11 Jul 2019

Startup whizz-kids have plenty to bemoan in Hong Kong this week: fewer venture deals in the mainland, lacklustre IPOs and a trade war clouding prospects for all. That marks a change from past exuberance. For those investing, though, it's a chance to be a little more demanding.

IndiGo row makes case for clipping founders’ wings

10 Jul 2019

The two top owners of India's largest and most profitable airline are at war over an old shareholder deal handing one of them outsize control. Now that the country has laid out strict rules for dual class shares and more, such pacts look like a relic of bad governance past.