Tennis Matters: I didn’t see the match-fixing

January 27, 2016

Tennis Matters Blue

Tennis is the latest sport to find itself embroiled in a corruption scandal.  It is not the problem that many observers expected
Leaders We Deserve was and still remains a blog about leadership and its implications in business.  Sport remains a useful way of ‘back engineering’ into business leadership.
In recent months sport has provided a wealth of examples of issues of global institutions failing in the most basic tenets of social corporate responsibility.  LWD subscribers will be able to track back to the most recent in athletics and football.
So now for tennis.  Over the last few weeks a story has developed in a rather predictable way.  First, a suggestion that a few low ranked players were involved in match fixing.
All credit to the BBC who can still produce world class reporting from time to time.
Silence from tennis authorities. The story builds
World number one Novak Djokovic speaks out suggesting it is a minor problem, although he was approached to fix a match early in his career.  First time I was awoken from my slumbers.  Novak was reported as dismissing the claims as sheer speculation.  oh, no  Novak.  Better to have stayed shtum.
More reports that the problem is widespread.
I start preparing this post.
Then an announcement that an official enquiry is to take place.
Tennis Matters
I recently self-published Tennis Matters, a little book of personal anecdotes. One seeded participant at the on-going Australian Open was given a copy to read.  It includes updates of several LWD posts.  I was advised by a legal friend to be careful of one of the posts which suggested there might be a drug problem in tennis.  So I listened to him, but there is still a hint of my concerns in Tennis Matters.
What I didn’t see coming 
What I didn’t see coming was a different sort of scandal.  Over the years there have been curious collapses from winning positions. Players have been fined for not trying.  Perhaps I didn’t want to see any suspicions.  I was more interested in the tensions that impair ‘thinking clearly under pressure’
This story has legs
You can find my slightly redacted comments about drugs in tennis in Tennis Matters.  Until I put out a revised version, this post will have to do.  I have a feeling the story deserves the customary not quite final words … Watch out for updates.
To be continued

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The Co-operative Group: A noble business failure?

March 12, 2014

The Co-operative Group has its place in the social and political history of modern Britain. Yet it is in deep crisis as its departing leader Euan Sutherland declares it ‘ungovernable’

On March 11th 2014 the following statement appeared on the website of The Co-operative Group

The Co-operative Group announces that Euan Sutherland has resigned as Group Chief Executive with immediate effect. Richard Pennycook, Chief Financial Officer, has been appointed as Interim Group Chief Executive.

The statement then quoted its former CEO’s damning indictment of its professionalism and governance:

“It is with great sadness that I have resigned as Chief Executive. I have given my all to the business and had hoped to be able to lead its revival. However, I now feel that until the Group adopts professional and commercial governance it will be impossible to implement what my team and I believe are the necessary changes and reforms to renew the Group and give it a relevant and sustainable future.

“Saving The Co-operative Bank and with it The Co-operative Group from administration was a huge task, but the changes required do not stop there, with fundamental modernisation needed to safeguard the future for our 90,000 colleagues and millions of members.

“The Group must reduce its significant debt and drive major efficiencies and growth in all of its businesses, but to do so also urgently needs fundamental governance reform and a revitalised membership.

“I will not accept the retention payments and long term incentive payments previously agreed for the delivery and protection of value in the Group and the Bank, even though this was successfully delivered. “I would like to thank all of the Co-op’s hard working colleagues for the support they have given me during my time. I wish them all well. The Co-operative has some wonderful people who deserve a great future.”

Concealing more than it says

Even without further background knowledge by the reader, the news item is of interest to any student of leadership. [Hint to tutors. Try redacting the name of the company and offer the resignation statement for class discussion.]

The resignation statement may be read as a farewell message, concealing more than it says. Why did the CEO fail to achieve the ‘fundamental modernisation’ he believed necessary? What does a revitalised membership imply? How do we interpret the statement that ‘The Co-operative has some wonderful people who deserve a great future.’

A missing story

As editor of LWD I am disappointed that after 1000 posts I have not reported one that dealt directly with the important history and current financial problems of the Co-operative Society. Even a juicy scandal earlier this year did not warrant a mention, although it led to the departure of Euan Sutherland’s predecessor. The story is one which includes one of the most powerful forces towards an alternative capitalism merging socialist ideals with self-help and corporate effectiveness.

What do you think?

I will offer more of the story as an addition to this post. In the meanwhile, I would be particularly interested in receiving the views of LWD subscribers who are unfamiliar with the history of the group, and their assessment of the situation as indicated in Euan Sutherland’s resignation statement.

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Posted by Tudor Rickards

The Shareholder Spring. Nice idea but will it turn into glorious summer?

May 23, 2012

Successful attempts by shareholders to restrict executive bonuses have been hailed as the outbreak of a Shareholder Spring. But, like the Arab Spring, summer may be a long way away

According to City A.M., the media group UBM has been the latest organization to experience a Shareholder Spring.

More than 47 per cent of investors failed to back the directors’ remuneration report, a result that would have been considered extraordinary before a recent spate of shareholder rebellions against pay levels at underperforming firms.

Protests focused on the substantial share option given to UBM’s finance director Robert Gray and a change in rules that meant performance-related bonuses would no longer take retail price inflation into account – possibly making it easier for executives to hit targets.

A spokesman for the firm said: “The Board has a continuing commitment to a process of active engagement with Shareholders and takes careful note of the lower percentage majority in favour of the Remuneration report. UBM’s executive remuneration policy is designed to reward and incentivise its senior management appropriately for an increasingly successful, growing and global company.”

Shareholder anger

Also in the UK, Aviva, Pendragon and Trinity Mirror have been corporations which have all faced the displeasure of shareholders.

Erika Morphy, writing for Forbes on leadership and its financial dilemmas, explores the Shareholder Spring through events at Yahoo

She suggests that shareholder pressures have been influenced through financial reforms in the United States such as the Dodd Franks legislation.

The so-called Shareholder Spring explains events at AOL, at Citigroup, which recently got its outstretched hand smacked by shareholders over a $15 million pay package for its CEO, Vikram Pandit, and at Credit Suisse and Barclays, which also received rejection by shareholders on compensation.
“Most famously, the Shareholder Spring has claimed Yahoo’s CEO Thompson’s head, if reports are true” she notes.

While recognising some victories for shareholders, Morphy concludes that “For the most part, companies are still firmly in control of their shareholders. Thompson is an exception, undone by a tin ear and flat-out stupidity in the way he marketed his credentials”

Leaders We Deserve has followed events at Yahoo since the controversial sacking of Carole Bartz a year ago [April 2011] which led to a temporary surge in its share price. Ms Bartz had taken over from Yahoo co-founder Jerry Yan in 2009.

Government plans do not convince

In the UK, the so-called events of Shareholder Spring seems more potent than those in the United States. The greater activity and pressure from large shareholders may demonstrate lack of conviction that government intervention through Vince Cable will be enough to address investor concerns. These reforms were mentioned in the forthcoming government plans last week.

The darling buds of May

The Arab Spring of 2011 is turning out to be not so much a tipping point, as a complex series of unresolved tensions throughout the Middle East. The Shareholder Spring may in that respect share some of its complexities.


Acknowledgement

Now is the Winter of our Discontent Button by ObsessionDesign, zazzle,co.uk.

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Is there a ‘Leadership vacuum’ at Lloyds TSB?

November 14, 2011

António Horta-Osório

Reports are suggesting that Lloyds Bank faces a leadership vacuum since CEO Antonio Horta-Osorio look medical leave two weeks ago

The Leadership Dilemma

The leadership dilemma has been reported as one of dealing with shareholder discontent. According to the Sunday Telegraph [13th Nov 2011]:

Major institutional shareholders are concerned at the lack of information from the bank since Mr Horta-Osorio left on medical advice two weeks ago …a number of investors said that they had not been personally contacted by Glen Moreno, the senior independent director, or by Sir Win Bischoff, the chairman, about the issue.

The sentiment among investors is that even if Mr Horta-Osorio returns to full health, it would be difficult for him to return because of the signal his absence – the result of “extreme fatigue” – has given to investors.

“It is clear the job was too big for him,” said one top 15 shareholder.

Another investor questioned why the bank was not speeding up its internal contingency plan.

Behind the headlines

The Telegraph article suggests that the company has failed to have addressed the reactions of its shareholders to the departure of Mr Horta-Osorio. Looking behind the headlines, I wondered whether the story was encouraged by parties dissatisfied with the performance of the board, and would welcome news that would discredit them before rhe appointment of an internal figure as interim CEO (Mr Moreno has been considered as a favourite candidate).

Another possibility is that powerful institutional shareholders see opportunity to exercise more influence over the Board’s decisions

What didn’t happen

What appears not to have happened is for a rapid line of communications to have opened up with the most influential stakeholders. While ‘wait and hope’ may have been a consideration, it is often a dangerous kind of strategy under conditions of corporate turbulence.

To go more deeply

The textbook Dilemmas of Leadership examines the importance of trust based leadership[chapter 6] and the challenges presented by corporate turbulence [chapter 11].

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Decline of a dynasty? Elisabeth Murdoch ducks board position on News Corp

August 6, 2011

Elisabeth Murdoch has declined an invitation to be nominated for a place on the board of News Corp. The move signals a decline in the prospects of a Murdoch dynasty

Rupert Murdoch’s actions over a period of years suggests his intentions of establishing a Murdoch dynasty at News Corp. The story has all the drama of a TV soap opera with a dash of reality TV as well. Part of the interest has been over which sibling would be most favoured to succeed the tycoon.

Any Murdoch is better than none

It has been suggested by biographers that any Murdoch would be prefered to someone outside the family. This is harder to achieve in a world in which there are interested parties or stakeholders. These extend to institutional investors, and governments concerned with Corporate responsibilities for ethical governance.

As might be expected, the eldest son Lachlan was front runner for heir to Rupert before signalling his reluctance to pursue a career in News Corp although remaining on the board. This placed youngest son James as a front runner in the speculation stakes. The 2011 problems of governance in the proposed takeover of Sky may have weakened the chances of James, but arguably have weakened the chances of all the Murdoch family to take over at the top of News Corp.

Elisabeth

Rupert Murdoch has no prejudice against women as business leaders. Elisabeth Murdoch was for a while a front-runner as his heir, and has demonstrated considerable leadership flair in creating her own media businesses. However, Elisabeth has, like Lachlan implied that her interests would lie outside the top job at News Corp. However, her interests have remained intertwined with those of her father.
Although allegations of nepotism have been made, there can be little doubt of her capabilities to manage large media operations.

According to the BBC

News Corp said Elisabeth Murdoch, 42, told [News Corp] directors that it would be “inappropriate” to join the board. She was expected to join the News Corp board after it bought Shine Group, the television production company she runs.

Prudence

Rupert’s eldest daughter Prudence MacLeod sits on the board of Times Newspapers Ltd, part of News International.

Then there’s Wendi

Rupert’s formidable wife Wendi has been considered a serious candidate for some while. A trust-fund established for their children has become a critical aspect within the power relationships in the extended family.

Leaders born and made

Dynasties provide rich materials for students of leadership. The eventual winners in the succession stakes sometimes justify what others call nepotism. Often however, second and third generation family members lack the entrepreneurial flair of the founders.

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Mattel co-founder Elliot Handler dies

July 26, 2011

Elliott Handler founded Mattel which became a great and at times controversial business empire. The creation of the Barbie Doll concept has been attributed to his wife, Ruth, and was named after their own daughter

Elliot Handler lived a full and lengthy life before dying in July 2011 at the age of 95. His story is a fascinating one.

Away in a cradle

Mattel was started in a garage, that mythic cradle of entrpreneurship. The company website provides a time-line on its website from its foundation in 1945 to the year 2005 showing its rise to a global corporation. It shows highlights such as the ‘Birth of Barbie’, now an astonishingly well-preserved 52 year old. It also traces the acquisitions and mergers through which the company has grown.

Mattel Inc. incorporates Fisher Price, and produces a wide range of famous products such as Barbie dolls, Hot Wheels and Matchbox toys. The company name is derived from Harold “Matt” Matson and Elliot Handler. After the release of the Barbie doll, Mattel went on to revolutionize the toy industry with a range of innovations such as talking dolls and toys.

In the shadow of Barbie

Perhaps Elliot Handler will be remembered as living in the shadow of a fictional child. However, he was no mean inventor and entrepreneur. One of his successes was the product line Hot Wheels. The die cast range became a classic collectable. Elliot had pushed ahead when others showed little confidence in his concept.

Triumphs and disasters

Major successes in the 1960s propelled Mattel to its premier position as the number one toymaker in America. The triumphs were accompanied by several dark episodes.

Ruth Elliot had become President, and was mourned at her death as ‘Mom of Barbie’. By that time, Ruth had also been ousted from the company for financial wrongdoings, and Elliot had also been forced out off the board.

In 2002, outsourcing production to China led to a scandal involving lead contamination. The toys were recalled and public apologies made to the Chinese people. The episode anticipated the more recent strategies of companies such as BP and Toyota facing a hit to their corporate reputation.

Rewriting history

What you will not find on the company website is much about the board room coup which ousted founder Elliot and his wife Ruth.

A leadership mission

Matell today offers a leadership mission:

“Leadership” at Mattel is the ability to develop and communicate a compelling picture of the future that inspires and motivates others to take action. Leaders at Mattel align themselves with Mattel’s core values, exhibit leadership competencies and drive for success in our business strategies. In this way, we will work to achieve our vision, “Creating the Future of Play.” Every day as Mattel’s 30,000 employees worldwide strive to realize that vision, our leadership team is guiding the way.

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Murdoch Meltdown

July 17, 2011

Elisabeth Murdoch and father Rupert

In three turbulent weeks in July 2011, Rupert Murdoch faced a complete meltdown of his global corporation News Corp. The crisis has a timeline which can be traced to the imprisonment in 2004 of a few ‘rogue’ journalists in one newspaper, the News of the World. This spread to allegations of a culture of corruption and phone hacking at the NOTW, and its closure. The story continued to spread with political fallout reaching the wider global corporation

We concentrate on the turbulent weeks at the start of July 2011, after briefly reviewing the wider timeline of events.

BBC Timeline

The BBC gave a good summary of the timeline of events from 2000 to July 20th 2011. although for whatever reason, overlooked the dimension of police corruption which is also to be found within the story. The Timeline It begins with the appointment of Rebekah Wade (later Rebekah Brooks) as editor of News of the World in May 2000, and ends with her resignation as Chief Executive of News International, July 15th 2011

Resignation of a News Corp executive fuels the wider story

Within hours of Rebekah Brooks tendering her resignation as head of News International, her predecessor Les Hinton, one of Rupert Murdoch’s closest lieutenants in the United States, fell on his sword, saying that the pain his reporters had inflicted on innocent people was “unimaginable”. Mr Hinton has been the publisher of The Wall Street Journal since Mr Murdoch bought it in 2007 and his continuing presence was threatening to drag the media mogul’s prize US newspaper asset into the scandal.

Two symbolic events

Two events received particular media attention. They were presented as reflecting a callous culture, which ignored the impact of behaviours on members of the public who were already victims of tragic events. Each story involved journalists who had targeted families of victims of highly emotive tragedies. In the UK, the definitive episode involved tampering with the mobile of the murdered teenager Millie Dowler which may have given false hope to the family. Rupert Murdoch was to meet and apologise personally.

In the USA, allegations developed of hacking of phones of families of victims of the 9/11 World Trade Center bombings.

An unfinished case

This post ends [17th July 2011] at the start of a week which promises more in the unfinished drama surrounding Rupert Murdoch and the business empire he founded. One interesting theme is being reported concerning his daughter Elisabeth, on whom it is reported he is now pinning his hopes to take the dynasty forward. This is certainly consistent with a story that has cropped up from time to time within biographic accounts.

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