The Discussion

A personal viewpoint from Dan Sweeney, Director
Institute for Enterprise Ethics, Daniels College of Business, University of Denver

On April 14, 2013, the Securities and Exchange Commission announced that Mr. Scott Reiman, a major benefactor to the Daniels College of Business and member of the University of Denver Board of Trustees signed an administrative order with the Commission regarding allegations of insider trading in which Mr. Reiman neither admits nor denies the findings in the agreement but agrees to certain financial payments and professional restrictions. The DU Board of Trustees has been working diligently on the question of how to deal with this agreement and Mr. Reiman’s future role with the University. The Chairman of the Board recently issued a statement to the Daniels community setting forth the results of their deliberations.

By Dan Sweeney, Director
Institute for Enterprise Ethics

The JP Morgan Chase Board of Directors voted recently by a significant margin to allow Jamie Dimon to retain both the CEO and the Board Chairman positions.  Mr. Dimon’s most powerful argument for keeping the two jobs as reported in the May 8, 2013 Wall Street Journal, was that “this is what I enjoy”. The other possibility he proffered as reported in the Wall Street Journal on May 11, 2013 in response to a question of what the downside was if the vote didn’t go the way he wanted and Mr. Dimon said: “one thing would be I might leave.” So, in the end, all is well on the JP Morgan playing field and Jamie won’t have to take his ball (and bat and bases) and go home.

By Dan Sweeney, Director
Institute for Enterprise Ethics

Apple has been vilified over the past several weeks for paying very little, if any taxes on the $74 Billion of profits earned outside and not repatriated to the United States. As reported in the Wall Street Journal of May 21, 2013, Tim Cook, Apple’s CEO defended this fact by saying: “…we pay all the taxes we owe, every single dollar." According to the Wall Street Journal, The company reportedly paid $2.5B and set aside another $4.4B for taxes in 2011 and said it could have paid even less if it had employed certain provisions of the tax code to protect even more of their earnings from US taxes.

By Janet Valades, Former Director, Safety & Health and Risk Management
Hess Corporation

At a recent Ethics Roundtable hosted by the Institute for Enterprise Ethics the power of peer pressure to nurture and sustain a culture of ethical decision making was discussed.  We also touched on the potential for one/some of a group of trusted peers to be able to sway a group to a high risk/unethical decision.  Bloomberg's recent reporting on the ongoing trial for the BP Macondo incident in the Gulf of Mexico in 2010 is a good example of this potential, resulting in serious consequences for not only the companies and people involved, but for regulators and the industry as a whole. 

The Securities and Exchange Commission today issued a report that makes clear that companies can use social media outlets like Facebook and Twitter to announce key information in compliance with Regulation Fair Disclosure (Regulation FD) so long as investors have been alerted about which social media will be used to disseminate such information. 

What happens on Twitter stays on Twitter … for all the world to see. The New York Fire Department learned that when one of its E.M.T.’s, the commissioner’s son, posted a string of offensive remarks. The technology industry got a reminder recently as well: After a woman posted a photo of two men whose jokes at a conference had bothered her, one of them was fired, and so was she.

By Dan Sweeney, Director
Institute for Enterprise Ethics

The Institute for Enterprise Ethics recently hosted an Ethics and Compliance roundtable discussion on the topic “The Ethics Risk Assessment”. The goal of the discussion was to explore how a company might go about assessing their exposure to risks of ethical breaches independent of compliance violations or after-the-fact ethical crises. Erin Nickell, Assistant Professor of Accounting at the Daniels College of Business lead the discussion and you can see her comments in the Institute Position Paper here. Some fourteen practitioners and two additional members of the Daniels faculty participated in the very lively and robust conversation.

By Dan Sweeney, Director
Institute for Enterprise Ethics

Of the many banks implicated in the Libor rate fixing scandal, the executive management of only one of these banks suggested that the bank’s executive and board leadership may be culpable.  Anthony Jenkins, the new CEO of Barclays following the resignation of Robert Diamond last summer, is taking direct aim at the bank’s culture describing it as short-term focused, aggressive and self-serving. Now if other banks would just follow Barclay’s lead and clean up the entire industry.

 

By Dan Sweeney, Director
Institute for Enterprise Ethics

Goldman Sachs Group, Inc. was reported in the Thursday, January 24 Wall Street Journal to be fighting a shareholder proposal for an independent chairman of its board (See: Goldman). This follows an effort again by Goldman last year on a similar proposal from the American Federation of State, County and Municipal Employees that ended with a negotiated deal to name a lead outside director.

What are these people so afraid of? The trend is inexorable: Independent chairs of boards of directors are the standard for public companies, and for several very good reasons.

By Dan Sweeney, Director
Institute for Enterprise Ethics

The New York Times on December 24 featured an article describing the marketing partnerships formed by Electronic Arts, the marketer of the Medal of Honor video game series and the manufacturers of high powered sniper rifles and high capacity magazines for semi-automatic rifles. The article also suggested some ways in which these partnerships may by enabling the kinds of catastrophes we witnessed in Newtown, Connecticut two weeks ago. I am curious how well EA’s marketing decisions were thought-through and whether certain important questions ever made it to the strategy table.