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JohnT
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Capitalist
Mar 1999
time: 00:32
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Thanks, Ned.
Choice quotes...
quote:
"Europeans used to say, 'This could never happen here; such greed is limited to America,' " recalled Sophie L'Helias, a French lawyer who advises shareholders. "Now, for the first time, they are saying, 'This can happen here.' " |
quote:
European corporate scandals have been wide-ranging, including a $1.2-billion fraud at Royal Ahold, the Dutch retailing giant; an uproar over executive compensation at Skandia Insurance of Sweden; and accusations of fraud at Vivendi Universal, which the company and its ousted chief executive, Jean-Marie Messier, settled this week with the Securities and Exchange Commission.
All these scandals had a strong American component. Ahold's accounting irregularities occurred at its U.S. Foodservice division. Skandia's problems came to light after a disastrous expansion in the United States. Mr. Messier's moves were driven by his hunger to turn a 19th-century French water utility into an American-style media conglomerate. |
Note that of the three, only one of them is stated to have occured in America and none of the three are linked to "weak" American laws or regulations. As far as I can tell, "disastrous expansions" are not against the law, nor is a revamping of your corporate structure and purpose.
But let's ignore these little facts for a bit of foolishness:
quote:
All this has made some here skeptical that the answer to Europe's problems is to move toward an American-British style of corporate governance. |
Me thinks that the skepticism comes from the following, not the above:
quote:
Some European companies have bucked demands by the United States that they comply with post-Enron rules, like a requirement that senior executives swear to the accuracy of their financial statements. Porsche, the German maker of sports cars, shelved its plans to list its shares on the New York Stock Exchange last year, rather than going along with the American regulation. |
However, the following might be true now, but generally these tendencies swing back and forth:
quote:
Pliant boards, with too many insiders, are seen as another weak point in European companies. |
This is a weak point in a lot of companies - for example, GM almost went under* in the early 1990's because of a rubber-stamping board, but after Roger Smith left and new chairman and CEO Bob Stempel did nothing to change GM's course (negative cash flows, too many investments in non-critical enterprises, insane union contracts, personnel issues including an odd bit of cronyism involving a most singularly inept officer, Lloyd Reuss), the outside directors, under the advice of their legal counsel Ira Millstein, did the unthinkable and literally took over the Company and the Board, even to the point of giving day-to-day orders to Stempel. This set a precedent that was soon followed by a number of America's blue chip companies, including IBM, Kodak, and American Express.
Sounds like the same thing needs to happen in Europe.
*That's probably a bit exaggerated, but the situation was quite bad.
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Tripledoc
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Well. A problem with European corruption versus American corruption is that I think Corporate America are much more vulnerable, since in all actuality they are relying heavily on foreign investors. So while corruption in Europe will have bad consequences for the European investment climate, corruption in the American economy will have a much more profound negative impact on the world economy as a whole. If you then add the structural weakness, the declining dollar, the trade deficit and it is clear that the demand for a squaky clean American business environment is much higher, than the demand for a similar European one. Not that I in any way would defend European corporations over American. Just making a reality check.
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Q Cubed
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t3h y3ll0w p3ril
Apr 1999
time: 23:32
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honestly? i'm all for globalization.
why does the sweatshop not bother me so much? because japan and korea had to go through it. england, germany, america, france, they had to go through it. is it possible for things to be any different? perhaps, if they bypassed industrialization and leapfrogged straight into info-based economies, almost like how parts of india are doing. is everybody going to be able to do that? no.
sweatshops suck, yes. so if you don't want to support those companies that use them, send your money elsewhere. others aren't so picky--or they don't have the luxury of being so picky, with stretched budgets and all. it's the way capitalism works. sooner or later, conditions will improve.
that said, there are parts of globalization that are just not good. such as those damned agricultural tariffs in europe and america. get rid of them.
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Tripledoc
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By structural weaknesses I meant the declining dollar, and the trade deficit. The sentence was a bit confused I know.
I dont get the Delaware and new Jersey joke. Do you mean who will become de-industrialized basketcase states?
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Tripledoc
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I see. Well, Denmark is the New Jersey of Europe then.
AND NO HAMLET QUOTES!
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26-12-2003 06:28
Thanks for the link! 
. You could have said most of the right 
.
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