The hottest Corporate Governance Substack posts right now

And their main takeaways
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Top Business Topics

Dual share structure: The Google model spreads

Musings on Markets • 0 implied HN points • 20 May 11
💼 Business Finance Investments Corporate Governance Valuation Market structure Finance Investment Valuation Corporate Governance Market Trends
  1. Google introduced a new way for companies to go public by using a dual share structure, allowing founders to keep more control through shares with extra voting rights.
  2. Voting rights are important because they let shareholders influence company decisions. However, many investors often overlook these rights if they believe the company is well-managed.
  3. Valuing stocks with different voting rights can be tricky. Usually, voting shares are worth more, especially in companies that aren't managed well.

How do you evaluate risk taking?

Musings on Markets • 0 implied HN points • 19 Nov 10
💰 Finance Risk Assessment Investment Strategies Market behavior Economic Policy Corporate Governance Risk management Investment Corporate strategy Decision-making Market Analysis
  1. Risk taking should be judged not just by the outcome but also by the process and information available at the time. Good decisions can sometimes lead to bad outcomes, and bad decisions can lead to success.
  2. It's important to consider the side effects of risk taking, like how it impacts others. A decision might be profitable for one person but harmful to society as a whole.
  3. How we reward or punish risk taking now can influence future behavior. If taking risks is consistently rewarded, more people will take risks in the future.

A Corporate Governance Risk Manual

Musings on Markets • 0 implied HN points • 25 Sep 10
💼 Business Corporate Governance Risk management Finance Emerging Markets
  1. Risk management is divided among different fields, like finance, strategy, and statistics. This makes it complicated and sometimes inconsistent.
  2. The author created a manual on risk governance for company directors after giving seminars around the world. He wants to share this knowledge with a broader audience.
  3. The manual not only summarizes important ideas but also includes tasks to help businesses evaluate their risk management practices.

Checks and Balances: Eisner and Disney

Musings on Markets • 0 implied HN points • 17 Sep 10
💼 Business Corporate Governance Leadership Management Finance Partnerships
  1. Good partnerships can turn around struggling companies, as seen with Eisner and Wells at Disney. They brought new energy and skill that saved the company.
  2. Without checks and balances, even good leaders can make poor choices. Eisner's decisions worsened after losing his partner who helped guide him.
  3. Strong boards of directors are important to keep management in check. They help prevent good leaders from making bad decisions that could hurt a company.

Cash and Cross holdings

Musings on Markets • 0 implied HN points • 28 May 10
💰 Finance Investing Valuation Markets Corporate Governance Economic Analysis
  1. Companies like Adris Grupa and Apple hold significant amounts of cash, but the market's perception of that cash can vary. Sometimes, cash isn't valued equally and can be discounted if a company isn't performing well.
  2. Tata companies often have cross holdings, meaning they own shares in each other, which complicates their valuation. Investors need to consider multiple companies to accurately value one.
  3. In emerging markets, trusted family names historically provided a way for investors to make decisions due to limited information. However, as markets evolve, these cross holdings might not reflect the true value of individual companies anymore.
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Accounting inconsistencies

Musings on Markets • 0 implied HN points • 30 Mar 10
💼 Business Accounting Finance Valuation Investments Corporate Governance
  1. Goodwill on balance sheets is often misleading; it doesn't truly represent value and can make financial statements look better than they are.
  2. Minority interests can confuse analysts because they represent liabilities rather than actual assets, which can distort financial evaluations.
  3. The accounting treatment of intangible assets and leases isn't consistent, leading to inaccurate measures of a company's true value and earnings.

Bad companies and good investments...

Musings on Markets • 0 implied HN points • 05 Nov 09
💰 Finance Investing Corporate Governance Market Analysis Business strategy Risk management
  1. Warren Buffett often invests in companies that others see as boring or bad, because he can identify good value at the right price.
  2. A company can be a poor business yet still be a great investment if bought at a low enough price.
  3. Buffett's approach shows that market timing and trends aren't as important as finding undervalued opportunities.

Insider Trading: My Perspective..

Musings on Markets • 0 implied HN points • 24 Oct 09
💰 Finance Investing Regulation Market Analysis Corporate Governance Economic Policy Insider trading Investment Strategies Stock Analysis
  1. Insider trading is when some investors trade using secret information not available to everyone. It's legal for company insiders to buy stock if they don’t do it right before big news, but illegal if they do.
  2. Studies show that insider trading doesn't always lead to big profits. Insiders might have better info, but they don't always make more money from it, and relying on tips can be risky.
  3. Instead of banning insider trading, we could make trading more transparent. This way, everyone can see what insiders are doing, which might level the playing field a bit.

MBAs and Ethics

Musings on Markets • 0 implied HN points • 31 May 09
💼 Business Ethics Education Management Corporate Governance Leadership Ethics Management Education Finance Corporate Governance
  1. Ethical oaths for MBA students sound good but might not work in real life. When tough choices come up, someone will always be unhappy, regardless of the oath.
  2. Self-interest isn't necessarily a bad thing. A balance is needed where individual goals can benefit the wider community instead of thinking serving others is the only way.
  3. People who talk a lot about ethics might not be the most reliable. It's often the ones who boast about their values who struggle when faced with real ethical challenges.

Stockholder democracy...

Musings on Markets • 0 implied HN points • 22 May 09
💼 Business Corporate Governance Finance Investments Market behavior Stock Markets Investments Corporate Governance Regulation
  1. Shareholder democracy is complicated. While it might seem simple to let shareholders propose board members, different shareholders have different interests that can conflict.
  2. Some investors may actually benefit if the company fails, like those involved in credit default swaps. This can lead to them nominating directors who might hurt the company.
  3. It's hard to decide who can be a 'good' shareholder. Since everyone's interests differ, trusting voters to make good choices is important, even if those choices vary widely.

Are accountants learning?

Musings on Markets • 0 implied HN points • 19 Apr 09
💼 Business Accounting Finance Corporate Governance Regulations Valuation Accounting Finance Valuation Corporate Governance
  1. Employee options should be counted as expenses when given. This means they must reflect their fair value, just like other types of employee pay.
  2. Leases should be treated like debt instead of just operating expenses. This change would provide a clearer picture of a company's financial obligations.
  3. Research and development (R&D) costs need to be considered as capital expenses. This way, valuable assets related to innovation aren't left off company balance sheets.

My thoughts on the AIG fiasco

Musings on Markets • 0 implied HN points • 20 Mar 09
💰 Finance Banking Investments Economics Regulation Corporate Finance Investments Banking Economics Corporate Governance
  1. When companies get government bailouts, they should understand that things are different and people are watching. Paying huge bonuses when others are suffering just seems unfair.
  2. AIG had to pay money to banks like Goldman Sachs to avoid defaulting on obligations. This was likely what the bailout money was meant for.
  3. Some AIG employees were not responsible for the crisis, so keeping them happy with bonuses could help the company recover. It's important to keep good workers, even if it looks bad politically.

Buffett: Man or Myth

Musings on Markets • 0 implied HN points • 02 Mar 09
💼 Business Investing Finance Corporate Governance Market Strategy Value investing Investing Management Finance Economics Corporate Governance
  1. Warren Buffett is a successful investor known for his philosophy of buying businesses rather than stocks. This approach has helped him make smart investment choices over the years.
  2. Buffett prefers investing in well-managed, mature companies and avoids being an activist investor. He values companies with strong leadership and tends to stick to his area of expertise.
  3. People often misunderstand Buffett's approach to risk. He does consider risk when investing, using conservative cash flow estimates to guide his decisions, so it's important to not ignore risk in your own investing.

Executive Compensation Caps

Musings on Markets • 0 implied HN points • 05 Feb 09
💼 Business Compensation Corporate Governance Investor Relations Regulation Government Economics Legislation Business Taxation
  1. Government should not set limits on executive pay, as it can cause problems in the job market. It might lead to unexpected consequences that could worsen the situation.
  2. Companies that accept government help should allow taxpayers to have a say in executive compensation. If they rely on public funds, they must be accountable to the public.
  3. Stockholders need to take a stand to ensure that executive pay is reasonable, rather than relying on the government. Investors should push for rules that involve them in the decision-making process regarding pay.

Accounting Fraud

Musings on Markets • 0 implied HN points • 07 Jan 09
💼 Business Corporate Governance Investor Relations Regulatory Compliance Corporate Governance Accounting Fraud Investment Risk management
  1. Self-interest is often more powerful than accountability in companies. When people face conflicts, they usually prioritize their own benefits.
  2. Good corporate governance is important to prevent fraud. Having a board that asks smart questions can help keep management honest.
  3. New accounting rules won't stop fraud. Companies often find ways to cheat around regulations, so being skeptical can save investors from losses.

Maybe active funds will be saved in seven months' time

Fund Marketer • 0 implied HN points • 08 May 24
💰 Finance Investment Funds Market Trends Corporate Governance
  1. Active funds are struggling because investors prefer passive options like ETFs. Some fund companies are not offering either right now, which could hurt them in the long run.
  2. Vanguard became successful by creating a special share class for ETFs linked to their mutual funds, which allowed them to build a good track record. Other companies are now trying to replicate this model after Vanguard's patent expired.
  3. There's a growing tension between shareholders and company boards over how businesses should be run, especially regarding social responsibility. Shareholders want more say and might push for changes through lawsuits.