Avoiding a proxy fight with the activist investors Carl Icahn and Mark H. Rachesky, Navistar International Corp. (NAV) recently strengthened the supervision of its senior managers by replacing three board members. But the truck and engine maker still has more work to do on its corporate governance. The former CEO Daniel C. Ustian and his team [...]
Tag Archives | corporate governance
GMI Ratings Governance Update | Navistar International Corp.
October 12, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
GMI Ratings Governance Update | Netflix, Inc.
October 11, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Netflix, Inc. stock prices recently surged, only to plunge once again. If the Los Gatos, Calif. video subscription company can’t stage a consistent comeback after months of travail, shareholders will find it challenging to make its senior managers accountable. Netflix shares soared nearly 10.5% to close at $73.52 per share on October 8, but have sunk since to [...]
GMI Ratings Governance Update | Avon Products, Inc.
October 10, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Avon Products, Inc. (AVP)’s embattled former CEO Andrea Jung said she’ll step down as board chairman on December 31. The beauty company has taken several such moves toward restoring its credibility in recent months, and now has stronger corporate governance. While serving as both chairman and CEO, Ms. Jung came under fire for problems ranging [...]
GMI Ratings Governance Issue | Chevron Corp.
October 8, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Chevron Corp. (CVX) recently elected two directors to its board including a female chemical engineering professor named Alice P. Gast. Adding new faces will mostly strengthen the U.S.-based oil company’s management, although both Chevron’s recruits might struggle to find enough time to fulfill their duties and the board’s composition still has room for improvement. Three [...]
GMI Ratings Governance Update | Vestas Wind Systems A/S
October 5, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Vestas Wind Systems A/S’ (VWS) senior managers discussed a plan this week to return the Danish wind turbine maker to profitability, and also announced the termination of their former CFO’s severance agreement after discovering his involvement in unauthorized deals. Even as Vestas struggles to win more investor confidence, its financial data continues to show signs [...]
GMI Ratings Governance Issue | Chaoda Modern Agriculture
October 4, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Chaoda Modern Agriculture on the verge of delisting By Richard Yim, Research Analyst Chaoda Modern Agriculture announced on September 28 that its five-month long search for an auditor continues. BDO Limited resigned as outside auditor on April 26, 2012 and in its letter of resignation said that it was unable to complete the audit for [...]
GMI Ratings Governance Issue | Tenet Healthcare Corp.
October 3, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Tenet Healthcare Corp.’s (THC) accounting of its finances has grown less conservative in recent months. Now, as the health care services company’s cash dwindles, CEO Trevor Fetter is taking on even more risk with a plan to raise debt, buy back shares and make acquisitions. Tenet said on October 1 that it is raising $800 [...]
GMI Ratings Governance Issue | Honda Motor Co., Ltd.
October 2, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Honda Motor Co., Ltd. (HMC) just expanded its earlier recall of Acura TL cars that have potential power steering problems to include Accords. This development is the latest example of how the Tokyo car maker has been openly and honestly improving its corporate governance, ranging from revamping its supervision of senior management to disclosing information to global investors. While having to [...]
GMI Ratings Governance Update | News Corp.
October 1, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
News Corp. (NWS) will announce five appointments including former regulators to lead its new compliance units, the Financial Times reported late Sunday. But at the same time, the media conglomerate’s financial statements have shown increased signs of problematic accounting in recent months as it undergoes various forms of upheaval. News Corp.’s new chief compliance officer Gerson Zweifach will announce [...]
GMI Ratings Governance Issue | Olympus Corp.
September 28, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Olympus Corp. (OCPNY) and three of its former executives pleaded guilty this week to charges related to a $1.7 billion accounting cover-up, the media reported. During the year since the Japanese equipment maker’s former CEO Michael C. Woodford raised questions about its deal-making, Olympus has made some improvements to its corporate governance, but continues to [...]
GMI Ratings Governance Issue | Discover Financial Services
September 27, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Regulators ordered Discover Bank to refund around $200 million to consumers after alleging that the unit of Discover Financial Services (DFS) marketed deceptively. Despite this recent embarrassment, the banking and payment services firm’s financial statements continue to show signs that the managers care more about appearances than reality. The Federal Deposit Insurance Corporation (FDIC) and [...]
GMI Governance Update | BP p.l.c. and OAO Rosneft
September 26, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
The media is buzzing about the possible sale of a stake in the Russian government-owned oil company OAO Rosneft to BP p.l.c. (BP). The U.K. oil giant might appoint a Russian director to its board, some reported in recent days. If the two companies do integrate, BP goes into the deal with better supervision of its [...]
GMI Ratings Governance Issue | Foxconn Technology Group
September 25, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
After around 2,000 workers brawled at a Foxconn Technology Group dormitory, the Taiwanese electronics maker said it would close a plant in China on Monday, according to Reuters. Although the Apple product supplier continues coming under fire, the international disclosure about its corporate governance remains relatively murky, signaling that its global clients don’t require much [...]
GMI Ratings Governance Update | Oracle Corp.
September 24, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Oracle Corp. announced a growing profit on lower sales – but who really knows what happened? Numerous warning signs suggest that CEO Larry Ellison and his team could have fudged the California software company’s earnings numbers. Oracle said on September 20 that its sales fell 2% to $8.2 billion during the three months ended August [...]
GMI Ratings Corporate Governance Update | Northrop Grumman Corp.
September 21, 2012 in Corporate Governance, Daily Viewpoint, Flash Reports
Northrop Grumman Corp.’s financial results now show fewer signs of risky accounting, but the defense firm’s corporate governance is far from perfect. The company’s financial statements reflect an AGR score of 42, indicating higher accounting and governance risk than 58% of companies. That’s up significantly from the previous score of 10 we had discussed in [...]
GMI Ratings Governance Issue | Cognizant Technology Solutions Corp.
September 20, 2012 in Corporate Governance, Flash Reports
Cognizant Technology Solutions Corp. (CTSH) has taken the positive step of adding to the diversity of its management, but the New Jersey outsourcing firm still has more room for improvement on its corporate governance. The company said September 18 that it elected Leo S. Mackay, Jr. to its board, which now has ten people. Cognizant [...]
GMI Ratings Governance Issue | DineEquity Inc.
September 19, 2012 in Flash Reports, Small Print
DineEquity Inc. (DIN) has been struggling with a high debt burden since the owner of International House of Pancakes bought Applebee’s in November 2007, and signs of accounting trouble are brewing in the company’s financial statements. Insiders have collectively sold 41,330 DineEquity shares in the past six months, or 8.8% of their holdings. Jean M. [...]
GMI Ratings Governance Update | Bank of America
September 18, 2012 in Corporate Governance, Flash Reports
Bank of America (BAC) still hasn’t cleaned up its act. While the Charlotte, N.C.-based financial services heavyweight recently took the laudable step of adding two more women to its board, all four of the new directors it named are associated with controversial companies. The management’s poor corporate governance puts Bank of America at high risk [...]
GMI Ratings Governance Issue | Raytheon Co.
September 17, 2012 in Corporate Governance, Flash Reports
Raytheon Co.’s CEO William H. Swanson said a possible merger of EADS and BAE Systems could distract the European defense giants and help his own company boost its share of their markets, Reuters reported. He should know. Around half Raytheon’s assets consist of estimates made about earlier acquisitions, and its financial data gives it an [...]
GMI Ratings Governance Update | DST Systems, Inc.
September 14, 2012 in Corporate Governance, Flash Reports
News hit that DST Systems, Inc.’s CEO Thomas A. McDonnell is retiring, and investors bought shares in the information processing and software services company. While DST has taken steps in recent months that could resolve some red flags about its corporate governance, McDonnell’s successor, Stephen C. Hooley, is a company insider who will inherit ongoing [...]