See Below C-Level

Here are a couple of thoughts that audit committees and auditors might consider regarding risk.

First, it seems clear that at Bear Stearns (per the book House of Cards) that there were people below the C-suite who understood the extent of… Read more

Board Effectiveness

Just a cautionary note: Independence and industry experience are important and necessary attributes for directors, but they are not a foolproof protection against poor board performance. Witness the case of bank boards during the financial crisis, as reported in the… Read more

Make Your Vote Count

Activist shareholders, regulators, and other corporate aficionados are urging directors to meet with,  listen to, and get input from their company’s long-term shareholders.  The idea is that in this way boards will be more responsive to shareholder concerns and shareholders… Read more

CEO-Board Relationships

Can it be the law of unintended consequences at work?  Does board independence raise the risk of adversarial relationships between boards and CEOs which in turn undermine companies’ business success?

Truly independent boards have resulted in many positive results.  A… Read more

Empty Voting

Lending shares is a big business.  Ask any large pension fund, and they will tell you that they lend shares because their funds benefit financially from the fees received.  Lending shares has real consequences when it is coupled with other… Read more

Trust, but Verify

Are audit committees digging deeply enough?  That’s one of the troubling questions raised by the Valukas report on the collapse of Lehman Brothers.

The Valukas report chastised Lehman’s auditor, Ernst & Young (“E&Y”), for failing to “question and challenge improper… Read more

Risky Business

I just finished reading House of Cards, by William Cohan, which details the fall of Bear Stearns.  The unfettered greed that the book described is something I expected to see.  The surprise, however, was that the firm’s top leadership and… Read more

Lehman Brothers Part I: When Is It Legal – But Not Right

The latest report on the collapse of Lehman Brothers indicates that the company indulged in shady, albeit legal, accounting maneuvers that masked the depth of its financial problems and precarious economic state.  What is astounding here is the report that… Read more

Don’t Forget the Little Guys

Proxy season is upon us once again.  Here’s an important note of caution to public companies:  Ignore the little shareholders only at your peril!

The effort to save money, combined with the notion that only the institutional shareholders influence elections,… Read more

Beware of 20/20 Hindsight

Following the rules without considering the ultimate objective is not enough.  The Valukas report to the bankruptcy court on Lehman Brothers  points out that the accounting rule Lehman used, “Repo 105”, to remove assets from its balance was legal and… Read more

« Previous Page — Next Page »