Cross Border blogs

Would you take this job?

With so much ire directed at the SEC, chairman Christopher Cox must be relieved that Obama’s election marks a convenient exit time for him. His official five-year term doesn’t end until 2010, but he has announced he is out.

The new boss is career regulator Mary Schapiro, who is currently CEO of the Financial Industry Regulatory Authority (FINRA), pending Senate confirmation.

Grizzled Wall Street blogger Gary Weiss is calling the pick 'terribly disappointing.' (She is possibly a cheerleader for penny stock promoters, he notes.) But the gentler Cox says he finds her ‘outstanding.’

She’s surely walking into a viper pit, a situation that won’t be all that unfamiliar to her having worked up and down Wall Street. To be at the center of things must be its own reward, since she’s settling on a salary of $158,500, a mere fraction of her FINRA compensation.

 

No holiday from layoffs

The Wall Street Journal only just recently proclaimed investor relations as a prospective field for job hunters displaced from financial institutions. But the IR space is shedding jobs, too. In recent days, we’ve heard some surprising news about four big players being made redundant. It’s getting ugly out there. 

Big news on the XBRL watch

If you are in software services or the financial analysis game, this news should be pretty exciting: the SEC has just published its Sunshine Act meeting notice, putting the proposal to phase in mandatory XBRL reporting for US filers on the agenda for Wednesday, December 17.

The feeling is that the commissioners will approve the rule. That should unleash a wave of XBRL software purchasing and consultant hiring by listed companies. While that may sound like yet another burden, especially during these times, IROs and others in the financial reporting chain will find it much easier to share and use data.

COMMENT: Defining reason

While former UBS executives are forgoing compensation, and Goldman Sachs, among other companies, aren’t issuing bonuses, Merrill’s chief and ex-NYSE CEO John Thain is asking for more money: a bonus in the amount of $10 million. Surprisingly, the devastated securities firm is none too pleased. Yet they did reconvene yesterday to reconsider his request.

Maybe Thain is thinking, what’s $10 million when the firm as a whole has lost  $11.67 billion over the last year? And they’re on the cusp of being acquired by Bank of America, which presumably saves the company billions more, in part, thanks to Thain's leadership.

Upon arriving at Merrill in 2007, Thain received a $15 million cash bonus and a pay package in the range of $50 to $120 million over several years. Since Thain only makes $750,000 right now, his request for a bonus, by Wall Street standards, is reasonable. But what is reason in a recession?

By Janine Armin
Associate editor
Corporate Secretary magazine

GE blog brings IR to life

General Electric has joined Dell and others in launching a blog, GEreports.com, to share news with investors. It is surprisingly blunt and free range. The conglomerate’s financial PR forces do take such brazen questions as ‘Will GE collapse because of GE Capital?’ 

The blog, in operation for about six weeks now, also allows readers to post their own comments, giving the site some of the character of typical stock chat boards, replete as they are with tedious armchair advice on corporate strategy and text in all caps. 

It’s kind of an easy way into the information normally found an IR website, with more illustration and some nice narrative explanations of the company’s position. Check it out.

COMMENT: Crisis causes cliché culture

Conjuring new and interesting ways of relaying information without resorting to the same old clichéd expressions is a key part of the journalist’s skill set. It’s surprising, therefore, to see that at times like this, we can become rather bad at it.

So obsessed are we with getting a splash of color here or a buzzword there that we get a bit carried away. It’s not enough to just relay facts; we have to make things sound engaging. We coin catchy phrases like ‘credit crunch’ or ‘credit squeeze’, feel mightily pleased with ourselves and then go for overkill, peppering our copy with superfluous crunches and squeezes, and anything else we can chuck in for good measure.

Our attachments to these ubiquitous terms are comparable to childhood infatuation with a new toy. Once we have a new term, we just can’t put it down. Google finds no fewer than 59,681 mentions of credit crunch out there; I know I’m not alone when I say I wish I had been responsible for that wonderful and prolific piece of neologism.

The problem with the ubiquity of these terms is that after using them to death, we start to get a bit self-conscious about our laziness: I have found myself spending an inordinate amount of time trying to come up with synonyms for ‘the current unprecedented economic turmoil’.

The recent economic turmoil – there we go again – has spurned several euphemisms: I’ve heard mentions of the undulating and even gyrating financial markets, which when combined sound more like some kind of quasi-acrobatic dance routine than the state of the Fortune 500.

IROs of the world: please don’t make the same mistake, or next year’s annual reports could make for very bizarre reading.

Clare Harrison
Deputy international editor
IR magazine

COMMENT: Battening down the hatches

Party frocks and tuxes will soon be making their way to the back of the wardrobe, marking a poignant end to the festive season. They probably won’t be seeing the bright lights of glitzy corporate soirées for quite some time - and certainly not to the same extent as in 2008.

Throughout the financial bloodbath of the past few months, companies have been continuing partying regardless. Lavish events had already been meticulously planned and paid for, despite the hundreds of thousands of jobs being lost across Europe.

Dresdner Kleinwort wouldn’t have dreamt of scheduling its September speed-investing day had it known Commerzbank would be announcing its takeover plans in the same month, along with 9,000 predicted job losses. It was a miracle IROs were able to meet as many investors as they did at the event, given the Lehman collapse on Monday of the same week and Lloyds’ announcement of its HBOS takeover just one day earlier.

Cost-cutting measures are being introduced to many businesses, which are likely to hit IR budgets for the coming year. One Austrian IRO told me all the managers at his company were asked to slash their costs by 10 percent; he has chosen to save money by doing in-house translations and reducing agency costs.

The show’s already over for poor old Woolworths and MFI - two seemingly indestructible UK retail groups - and who knows whether there are more casualties on the way? Entrepreneurially minded IROs have begun to leave the fold and set up their own IR consultancies. There’ll be much need for help in the coming months, but the extent to which IR can afford to splash out is another matter entirely.

Our advice is to make the most of the current festivities while they last!

Fay Sanders,
International editor,
IR magazine