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Opinions and views from expert CFOZone members.

Tag >> career/management
May 28
2010

Treating investor schizophrenia

Posted by SherylNash01 in risk managementgrowthcorporate investor relationscareer/management

SherylNash01

The competing demands of growth and risk management have never seemed more in conflict than they are today, according to an informal poll of corporate investor relations directors by the Corporate Executive Board, www.executiveboard.com/finance/. These IR folks say investors are demanding that companies not miss out on growth opportunities even as they worry that firms have not done enough to shore themselves up against the recession's emergence.

A contradiction? You bet. As economies start to recover at very different rates, investors want to know how managers plan to take advantage of those recovering quickest, while not being exposed to those posing the most risk. Yet those economies may often be one and the same.

May 28
2010

Glass half full, not half empty?

Posted by Ron F in recoveryrecessioneconomyconsumer spendingcareer/management

Ron F

Talk about accentuating the positive. This Reuters report just about takes the cake. It's also a complete jumble of contradictory data.

So rather than pick it up, I've decided to "Fisk" it, which is Webspeak for inserting snarky comments into someone else's text and comes from the name of Iraq war critic and journalist Robert Fisk, whose brilliant work generated lots of such treatment on right-wing sites back in the day. We'll see if Reuters complains about my application of the technique on its material.

May 26
2010

Crackdown on cronyism adds risk to foreign M&A;

Posted by SherylNash01 in foreign M&A;FCPAemerging marketsdue diligencecareer/management

SherylNash01

Companies looking to grow through acquisitions in emerging markets may have more risk to discount: the likelihood of prosecution for bribery arising from such deals seems to be growing. And that suggests they need to do more due diligence on such deals or pay less for a target than they would otherwise.

As we reported earlier,  the Department of Justice and SEC initiated 40 Foreign Corrupt Practices Act related actions in 2009, up from 33 in 2008. Criminal and civil corporate fines this year already exceed $400 million, a pace that would exceed the $645 million that companies paid last year.

May 26
2010

Business isn't waiting for Washington on climate change

Posted by SherylNash01 in Sustainabilityclimate changecareer/managementcarbon emissions

SherylNash01

Nearly one in five US companies expect to reduce carbon emissions in the next two to five years, according to a survey by PricewaterhouseCoopers. The survey found that 16 percent are bracing for that possibility, while 13 percent expect new climate regulation and 11 foresee new legislation in this area. And twelve percent expect to improve energy efficiency in general.

"Although federal climate change legislation is uncertain in the short term, there are plenty of government and private sector initiatives driving companies to start reducing emissions now," said Kathy Nieland, leader of the Sustainability and Climate Change practice at PricewaterhouseCoopers in a prepared statement.

May 20
2010

Foster risk-aware culture to reduce risk

Posted by SherylNash01 in riskk managementRiskcorporate culturecareer/management

SherylNash01

Culture is one of those corporate intangibles. You can't wrap your arms around it, but it is powerful and of increasing importance--especially as M&A grows and risk management tops the corporate agenda.

"The continuing increase in merger and acquisition activity is heightening the importance of cultural analysis (both for due diligence and post-merger integration purposes). Culture is also an issue in large-scale outsourcing partnerships, which are becoming more prevalent, not to mention more strategically significant," Mark Clemente, president of consulting firm Clemente Communications Group, told CFOZone.

May 19
2010

Building global skill-sets with international assignments

Posted by SherylNash01 in relocation, international assignments, career/managementcareer advancement

SherylNash01

Executives are willing to do what it takes to get that next great gig - be it moving out of state, region or country. So said 82 percent of those who recently took the Executive Quiz, commissioned by The Korn/Ferry Institute.

What's driving executives to pack their bags? Career acceleration is the primary reason to move, according to 78 percent of those surveyed. However, compensation is not necessarily the number one motivating factor. Nearly half of global executives say the "quality of life" in a new location would most motivate them, while only 20 percent chose "job title or promotion", or "salary", as the top motivator. Eighteen percent of executives cite "the reputation of the company" as the primary motivating factor.

May 16
2010

Time to rethink capex

Posted by SherylNash01 in Cashcareer/managementcapex

SherylNash01

With companies holding cash rather than putting it into property, plant and equipment, it's becoming more important that they prioritize their opportunities for deploying it. If they fail to exploit them, sooner or later investors will start demanding their capital back. And the more cash on the balance sheet swells, as it has of late, the sooner that time will be.

Sam Silvers, author, Finance Transformation: Think a la carte, not overhaul, and Deloitte Finance Transformation Practice Leader, offers some fresh insight into how to get enough out of capital investment to be worth the risk.

May 11
2010

Do CFOs add or subtract value as board members?

Posted by SherylNash01 in Sarbanes-Oxleycorporate governancecorporate boardscareer/management

SherylNash01

While shareholders and Sarbanes-Oxley demand more independent directors on boards, a new study shows companies with boards that have at least one key insider, the CFO, are better at financial reporting than those without that executive on their boards. But that doesn't necessarily mean that all companies should appoint their CFOs to their boards, not at least without taking other considerations seriously into account. In fact, most companies probably should still look elsewhere for the expertise that CFOs supply.

The study found that companies with CFOs on their boards have more effective internal controls over financial reporting, higher accrual quality and a lower likelihood of restatements.

The study measured the quality of financial reporting by examining the incidence of material weaknesses reported under Section 404 of Sarbanes-Oxley. The provisions require companies to document and test internal control over financial reporting, and the company's independent auditor to independently test those controls and opine on internal control effectiveness.

May 11
2010

Intellectual property increasingly at risk

Posted by SherylNash01 in risk managementRisk, intellectual property, corporate governancecorporate boardscareer/management

SherylNash01

Patent infringement has reached the point where companies can no longer rely on litigation alone to protect their intellectual property, experts say. And those on the wrong end of such suits have to take them more seriously.

The intellectual property of the world’s 500 largest corporations is now estimated to be worth over $3 trillion, roughly 80 percent of their total market value. Yet some $59 billion of that is stolen in the US each year, because few companies have systems and controls in place to manage and monitor the risk that others are to stealing their intangible assets or that they themselves are in violation of someone else’s patent.

May 06
2010

It's not Greek to us any more

Posted by Ron F in Timothy GeithnerGeithnerfinancial crisisEuropean UnioneuropeEuro areaeconomydemanddefaultcareer/managementbondsBanksbanking reformbailouts

Ron F

The violent backlash against the rescue plan that Europe has come up with for Greece should be a warning sign for those who think the bond market should rule public policy.

Yes, Greece must get its act together in terms of the black market and corruption, and tighten its belt on public finances. It simply has no other choice. But austerity isn't going to help the country repay its debt, not when the global economy continues to suffer from weak demand.

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