Vexed in the City
Banks, insurance companies and brokers are about to come under close scrutiny over sexual harassment and bullying in their organisations, according to the Financial Times.
A probe by the Financial Conduct Authority will also look at whether non-disclosure agreements are being used “hush up grievances”.
The news was delivered by Sarah Pritchard, executive director of the FCA, while appearing before a House of Commons committee of MPs looking into “sexism in the City”.
She told the committee that the FCA wanted to know how cases of harassment—there have been high profile examples in recent times—are resolved. She said the regulator would “be able to take that into account in our future supervisory work”. Cue hurried calls to lawyers.
This time, it’s personal
When it comes to an audit committee chair, it seems the quality of the auditor they select is not just about the reputation of their companies—it’s personal.
A study by a team of business boffins in Germany interviewed 23 audit chairs to investigate the relationship between the decisions they make over audit firms and personal risk. And it seems decisions are very close to home and touch on worries about reputation.
In particular, audit chairs fear being perceived as not in control of issues such as accounting restatements, enforcement findings, profit warnings and even “positive deviations from market expectations”.
This leads committee leaders to prefer “moderate” accounting decisions. And because they feel “ill-equipped” to judge the riskiness of a management accounting decision, they use auditors as an “early warning system” and “crucial” information provider.
According to the report, they expect external auditors to tell management whether their policies are extreme or not, and then use those to help exert pressure from the auditco.
And this is linked to “personal” interests, the report says. “Specifically, we find that, since an auditor’s public disclosure of a breach threatens the ACC’s [audit committee chair’s] personal reputation, ACCs may prefer an auditor who is independent from client management (and hence will report a potential breach privately to the ACC), rather than a notion of auditor independence that would imply the reporting of breaches to the public.”
Well, we all like to be tipped off about impending trouble. Seems audit committee chairs are no different.
A new generation
Look out! MBA suits tooled up with artificial intelligence skills are coming. Yes, if you were feeling threatened about your skillsets, this is probably the reason.
A survey by the Graduate Management Admission Council, finds that 74% of employers are now actively seeking “technological expertise” among new hires, with a particular liking for MBAs with AI “proficiency”.
Anne Alaoui, head of MBA careers at London Business School, tells the FindMBA website: “AI is impacting many aspects of business. It’s rapidly evolving with generative AI, and employers naturally want to stay ahead of the curve in terms of how they manage their organisation, the products and services they offer, and the experiences they provide to customers/clients as well as to their employees.”
Now might be the time to book that course you’ve been putting off.
It’s been a difficult time for Disney. First, there was that clash with Florida governor Ron DiSantis over supporting LGBTQ rights and then losing the special administrative status for Florida Disney World. Then there was the loss of chief executive Bob Chapel, who was replaced with former CEO, Bob Iger.
Now the house of Mickey Mouse is at odds with activist investor Nelson Peltz, refusing to appoint his nominees (among them, himself) as non-executives to the board.
Peltz has criticised the company’s stock performance and says that its streaming business is not doing as well as it should.
Disney, according to a proxy statement, believes that, despite his complaints, Peltz has “not presented a single strategic idea for Disney”. Sounds like a six-part mini series in the making. Wonder where it could be streamed?
Trouble at mill
By the way, it turns out activism is not just the preserve of billionaires such as Peltz.
The Strategic Organizing Center, a US club for trade unions, has launched a campaign to have three people appointed to the board of Starbucks. This after Starbucks resisted the recognition of unions for its baristas.
Its nominees include Maria Echaveste, a former White House official; Joshua Gotbaum, current chair of the audit committee at asset management firm Thornbury Investment; and Wilma Liebman, who was appointed chair of the National Labor Relations Board by the Obama administration. They’ve even got a website: brewabetterstarbucks.com.
That’s a strong line-up. Stronger, in fact, than anything currently served at our local Starbucks. The coffee chain may be drinking decaf in more ways than one.