The Magazine of Corporate Responsibility

Archive for February, 2011

Self-Deception and Challenges for Leaders

Columnist Gael O’Brien examines several recent crises and finds a common trait: self-deception by leadership. It “reflects an image that allows leaders to disengage and disconnect from their actual impact on others,” she writes. “Aside from the damage it does to those affected, it creates an understandable gap in trust, which is the very thing leaders want to re-build after a crisis.”

Wall Street Cash Bonuses Fell in 2010; Average $128,530

Cash bonuses paid to New York City securities industry employees declined by nearly 8 percent to $20.8 billion in 2010, as Wall Street firms shifted toward more deferred compensation and higher base salaries, according to an estimate released by the New York State Comptroller. For the average Wall Street worker, however, that still translated into a 2010 cash bonus of $128,530.

Novartis Pay Plan Encounters Strong Shareholder Opposition

Nearly 39 percent of Novartis shares were voted against the pharmaceutical giant’s executive compensation plan. Shareholder critics had expressed particular concern over the size and structure of payouts for Novartis Chairman Daniel Vasella, who has in recent years been awarded a package with an estimated market value of about $21 million annually.

Corporate Governance in Middle East and North Africa

Even as political regimes in Tunisia, Egypt, Bahrain and Libya deal with ongoing pressure to change or adapt how they rule, a new study reports that a “second wave” of corporate governance appears to be forming among financial markets in the Middle East and North Africa.

Pay for Risk-Appropriate Performance

Among the December 2009 proxy rule changes approved by the SEC was a requirement that companies discuss and analyze risks that are reasonably likely to have adverse effect on the company’s reputation and/or sustainability. This means companies must not only identify the risks facing them but also determine the probability and severity if realized and how that relates to the company’s compensation policies and programs.

26 Years After Bhopal: Are Chemical Plants Any Safer?

Bhopal should have been a wake up call, but it is unclear whether chemical plants around the world are any safer a quarter century after the December 1984 disaster—during which some 40 tons of toxic methyl isocyanate gas leaked from a pesticide plant owned by Union Carbide (now part of Dow Chemical), killing 2,259 people immediately and causing lifelong health problems and premature death for tens of thousands more.

Apple Expands Supplier Responsibility Program

Apple Inc.’s latest Supplier Responsibility report shows a 25% increase in audits of supplier facilities during 2010 to establish compliance with the company’s standards for hiring, training and worker safety. The company said a report by an independent team of suicide prevention experts about suicides last year at a supplier plant in Taiwan found the supplier’s response “had definitely saved lives.”

Cell Phones and Cancer Risk: Update

Cell phones have only been in widespread use for a couple of decades, which is far too short a time for us to know conclusively whether or not using them could cause cancer. Research thus far appears to indicate that most of us have little if anything to worry about.

Video: Companies Can’t Be Parasites Anymore

Stephen Miles, vice chairman of Heidrick & Struggles, the executive search firm, tells Big Think that the global financial crisis and the advent of the Internet age have transformed the relationship between business and stakeholders.

Proxy Season 2011: Progress or Procrastination?

Reporter James Hyatt says that depending on whom you ask, when it comes to shareholder activism and corporate governance issues this year’s proxy season is a glass half full, a glass half empty, or a glass completely shattered.