Management & Leadership

Time for Germany to make Deutsche/Commerz happen

21 Mar 2018

The country’s two biggest banks are projected to scrape mid single-digit returns on tangible equity by 2019. A merger that cut a tenth of joint costs could get that closer to double-figures. It could also stabilise Deutsche and give Berlin an excuse to sell its Commerzbank stake.

Vivendi discovers quitters can be winners

21 Mar 2018

Vincent Bolloré’s media group has made a capital gain of 153 pct by selling its stake in Ubisoft, which he had long coveted. The restraint is laudable. If only he could exit as easily from an investment in Telecom Italia, where he is stuck with a paper loss and angry investors.

James Packer’s exit deals Crown a better hand

21 Mar 2018

The Australian billionaire has resigned from the board of his casino empire again, this time for health reasons. He leaves a group still reeling from a Chinese crackdown that left staff in prison and prompted a costly global retreat. The path to recovery is clearer without him.

Pete Peterson built a career, and legacy, on debt

20 Mar 2018

The former Lehman CEO and Nixon cabinet member revolutionized modern finance by teaming with Stephen Schwarzman to found private-equity giant Blackstone. He later used his wealth to champion the cause of deficit reduction. Washington has yet to repay that obligation.

Cox: Dual-class buyers’ early remorse at Facebook

20 Mar 2018

IPO investors in 2012 granted founder, CEO and Chairman Mark Zuckerberg totalitarian power to build the social network. He's now in over his head, seemingly struck dumb, amidst a whirl of data-mishandling allegations. His nearly 60 pct voting control means shareholders are stuck.

Elon Musk pay deal is crazy enough to get the nod

20 Mar 2018

The Tesla boss could collect nearly $60 bln over 10 years. That’s excessive and surely unimportant for motivation. Yet it’s built on PR-stunt targets involving sales, EBITDA and market cap exploding 10-fold or more. For investors voting on the plan, it’s like playing the lottery.

China’s regulatory mega-merger howls for synergies

20 Mar 2018

Uniting banking and insurance oversight while consolidating the work of other ministries should relieve burdens Beijing puts on private enterprise. Big layoffs would be an important next step for the new regime. Idle paper-pushers have grown too fond of mindless crackdowns.

China’s new central banker is a gesture to U.S.

19 Mar 2018

Vice Governor Yi Gang was a long shot due to prejudice against "sea turtles", or Chinese with overseas experience. But as well as a reformer, Beijing wanted someone who could reassure foreign investors. Yi is both. The financial bureaucracy needs more like him.

Viewsroom: How long should a leader lead?

16 Mar 2018

China’s President Xi Jinping can now stay in power for life. Goldman Sachs CEO Lloyd Blankfein seems ready to retire after 12 years at the top. Yet five years may be the ideal length of service. Breakingviews columnists discuss the limitations to limitless rule.

Li Ka-shing’s exit ushers in new era for tycoons

16 Mar 2018

The Hong Kong magnate built a property-to-telecoms empire. At 89, Li retires as the city faces economic and political uncertainty, while protectionism globally is on the rise. For his son and successor, Victor Li, replicating the returns his father delivered will be tough going.

Altice investors require a stomach of steel

16 Mar 2018

Patrick Drahi’s telecom group has lost half its market value in less than five months. Spinning off the U.S. arm is sensible. But the slimmed-down parent’s 31 billion euros of net debt is almost 15 times its implied equity value. That is a recipe for wild share price swings.

Wells Fargo hands CEO perfect financial incentive

15 Mar 2018

Tim Sloan’s 36 pct comp boost may look excessive for a problem bank under Fed censure. But he’s the lowest-paid boss of a major U.S. lender, and his bonus is entirely in shares - so he’ll lose it all if he’s ousted. If his turnaround succeeds, though, he’ll deserve every penny.

Curse of Libor belatedly strikes at SocGen

15 Mar 2018

Deputy CEO Didier Valet is leaving to preserve the French bank’s “general interests”. His role as CFO when SocGen staff submitted inaccurate interbank rates jarred with the bank’s efforts to minimise a U.S. fine. As peers have learned, not knowing is not an adequate defence.

Trump goes from A-list to CNBC-list with econ pick

14 Mar 2018

Larry Kudlow is a great media communicator, and mostly conventional supply-sider and free trader. But guiding policy for the world's largest economy requires more than pontificating on television. It's another sign of this White House's increasingly shallow talent pool.

Activist adds governance flub to drab Newell pitch

14 Mar 2018

Starboard’s three top board picks will buy $25 mln of stock in the consumer-brands outfit if it wins a proxy fight. That’s a fraction of their unpopular payoff after Newell bought their firm, Jarden, and highlights Starboard’s lack of vision. Investors should leave it on the shelf.

U.S. pensions struggle to hold line on governance

13 Mar 2018

A bull market is boosting American retirement funds but not corporate standards. Trustees worry the Trump administration may curb their influence over boards while global competition fuels a race to the bottom on voting rights. They may have to run hard just to hold still.

Volkswagen investors are stuck in the past

13 Mar 2018

The carmaker’s shares are priced at a 20 pct discount to German rivals Daimler and BMW. That’s despite fast growth, a rising operating margin and scale that gives it an edge in electric vehicles. Cost cuts and a full year without unexpected diesel provisions would help close the gap.

Rexit shrinks White House talent pool, welcome mat

13 Mar 2018

Donald Trump fired Secretary of State Rex Tillerson, shifting officials around to replace him. The former Exxon CEO wasn't in the president's inner circle, but the world has lost a reassuring interlocutor. With outsiders leery of working for Trump such problems could get worse.

ING pay fiasco confirms banking’s utility status

13 Mar 2018

The Dutch lender has withdrawn a 50 percent salary hike for its CEO following a public outcry. Political opprobrium stems from past state support for banks. The inevitable consequence is that bosses become glorified civil servants. Directors and shareholders take a back seat.

Goldman succession goes against the tide

12 Mar 2018

Investment banker David Solomon is front-runner to succeed Lloyd Blankfein as CEO after his main rival quit. That would end 12 years of traders at the top, a sign of Goldman’s troubles in that business. Yet trading could be due a boost as volatility returns and regulations recede.