Critics recently protested against Samsung Electronics Co., Ltd. (SEO:005930)’s alleged patent infringement and misuse of Chinese labor. We continue to warn about problems with the Korean consumer electronics giant’s corporate governance such as its ownership structure. The telecom network equipment maker Ericsson said it was suing Samsung for patent infringement after two years of talks [...]
Archive | Flash Reports RSS feed for this section
Slammed Again For Practices, Samsung’s Ownership Still Problematic
November 27, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
GMI Ratings Governance Update | Moody’s Corp.
November 20, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Moody’s Corp. (MCO) could better safeguard itself from the business conduct failures that the Securities and Exchange Commission discovered in its second annual review of nine ratings agencies. The New York firm needs to take more steps to prevent its senior managers from abusing their powers. Without specifying names, the U.S. regulator said on Nov. [...]
GMI Ratings Governance Update | The McGraw-Hill Companies
November 19, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
The U.S. Securities and Exchange Commission published a review of credit ratings agencies’ business conduct that noted findings such as the failure to follow policies, keep records, and disclose conflicts of interest. While the regulator did not say who failed at what, financial filings show that the people who run The McGraw-Hill Companies (MHP), of [...]
GMI Ratings Governance Update | Wal-Mart Stores, Inc.
November 16, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Wal-Mart Stores, Inc. (WMT) confirmed this week that a previously disclosed investigation into bribery at its overseas units expanded into markets including Brazil, China and India. While it’s positive that the retailer is taking steps to examine allegations of such behavior, Wal-Mart could do more to improve the strength of the board that supervises such [...]
GMI Ratings Governance Issue | Vodafone Group Plc
November 15, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Vodafone Group Plc (VOD) adjusted its earlier estimates about the value of operations in Spain and Italy downward by £5.9 billion. While the British mobile phone giant clearly had no power to prevent the European crisis, its financial statements have contained warning signs that its managers tend to present their performance in the best possible [...]
GMI Ratings Governance Issue | Eastman Kodak Co.
November 14, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
As Eastman Kodak Co.’s (EKDKQ) cash dwindles and its creditors battle in bankruptcy court for repayment, some objected that the photography company’s CEO Antonio M. Perez continues putting his own interests first when it comes to compensation. Kodak said Nov. 12 that it managed to swap $317 million of existing debt and to obtain $476 [...]
GMI Ratings Governance Update | Olympus Corp.
November 13, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Olympus Corp. (OCPNF.PK) said it returned to a profit during the six months ended September 30, but the equipment maker also warned that it will sell fewer digital cameras than expected. Investors should prepare for the possibility of more surprises down the road. Olympus earned ¥8.015 billion during the six month period – boosted by ¥15.887 [...]
GMI Ratings Governance Issue | SandRidge Energy, Inc.
November 12, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
A shareholder in SandRidge Energy, Inc. (SD) said the Oklahoma oil and natural gas company should find new management, making complaints about various issues including “appalling” corporate governance. We have warned for more than a year about SandRidge’s high risk in this area, and its financial statements continue to reflect problematic accounting and board composition, [...]
GMI Ratings Governance Issue | Morgan Stanley
November 9, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Morgan Stanley (MS) said its co-president of institutional securities, Paul J. Taubman, will leave at year end, after which the other co-president Colm Kelleher will assume full responsibility for the division. As the New York financial services firm shuffles its senior managers, their board-level supervision remains above average in quality but leaves room for improvement. [...]
GMI Ratings Governance Update | Netflix, Inc.
November 8, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Netflix, Inc. has taken the controversial step of using a poison pill to fend off the activist investor Carl Icahn. The Los Gatos, California-based video subscription company’s latest move is another example of how shareholders will find it challenging to make its board accountable, as we had already warned. CEO Reed Hastings and his team [...]
GMI Ratings Governance Issue | The Goldman Sachs Group, Inc.
November 7, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
The Goldman Sachs Group, Inc. (GS) announced the appointment of another independent director, Mark Edward Tucker, effective Nov. 5. But Goldman has much further to go on improving its corporate governance. Mr. Tucker isn’t the ideal candidate. As the CEO of AIA Group Ltd., the insurance company that American International Group Inc. (AIG) spun-off in [...]
GMI Ratings Governance Update | Chesapeake Energy Corp.
November 6, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Chesapeake Energy Corp. (CHK) downwardly revised its earlier estimates about the value of its natural gas and oil properties by more than $2 billion in the three months ended September 30. The U.S. energy company’s high risk of delivering such surprises has been manifest for years and continues. Chesapeake explained its need to adjust estimates [...]
GMI Ratings Governance Update | MetLife, Inc.
November 5, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
MetLife, Inc. (MET) said it swung to a loss during the three months ended September 30, in part because the New York insurer had to downwardly revise its earlier estimates about the value of its U.S. retail annuity business by around $1.6 billion. The company is prone to such surprises. As we noted in August, [...]
GMI Ratings Governance Issue | Sharp Corp.
November 2, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Sharp Corp. recently warned about its ability to survive, as demand slows for its flat panel televisions and multiple headwinds also batter the Japanese electronics maker. Its President Takashi Okuda said at a local news conference that the situation might have been different had his team moved more quickly, MarketWatch reported Nov.1. Unfortunately, Sharp’s senior managers continue [...]
GMI Ratings Governance Update | Hon Hai Precision Industry Co., Ltd.
November 1, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Hon Hai Precision Industry Co., Ltd., which controls Foxconn Technology, said its profit gained during the three months ended September 30. But the Apple product maker could improve its disclosure to international investors about such business results. To be sure, Hon Hai publishes English-language news on its website and also files information to the Taiwan [...]
GMI Ratings Governance Issue | Allstate Corp.
October 31, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
As homeowners grapple with damages in the aftermath of the storm in the Northeastern U.S. this week, The Allstate Corp. has readied its staff to handle the inevitable insurance claims. Unfortunately, those seeking help depend on the promises made by a company that shows signs of poor corporate governance. Allstate said Monday that it had [...]
GMI Ratings Governance Update | CNOOC Ltd.
October 30, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Regulators are considering whether to approve China-based CNOOC Ltd.(CEO)’s $15.1 billion bid for Canada-based Nexen Inc (NXY). While neither energy company has stellar corporate governance, CNOOC Ltd.’s leaves more room for improvement. Canadian Prime Minister Stephen Harper said CNOOC Ltd.’s offer “raises a range of difficult policy questions,” Bloomberg reported this month. They will be [...]
GMI Ratings Governance Update | TransDigm Group Inc.
October 29, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
TransDigm Group Inc. (TDG) recently announced reforms such as no longer entitling senior executives to company-paid automobile or country club expenses — but clearly, the aircrafts parts supplier has a much longer way to go on improving its corporate governance. The company said October 25 that the previous day it amended its employment agreements with executives ranging from [...]
GMI Ratings Governance Issue | Icahn Enterprises L.P.
October 26, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Carl C. Icahn recently criticized Oshkosh Corp. (OSK) for continuing to “overpromise and under deliver.” After the activist investor asked Oshkosh shareholders to sell their holdings to him or replace the truck maker’s board with directors that his team nominated, the existing board recommended rejecting his offer on Friday on the grounds that it undervalues Oshkosh. As it happens, Mr. Icahn’s own [...]
GMI Ratings Governance Issue | Broadcom Corp.
October 25, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Broadcom Corp. (BRCM), which makes chips for mobile devices, said its profit fell during the three months ended September 30 amid challenging market conditions. But the reality could be worse. Broadcom’s financial statements suggest that CEO Scott A. McGregor and his team are doing more than the normal amount of estimating about their earnings. Broadcom’s [...]