30 years ago he joined the British subsidiary of Olympus, the Japanese camera and optical giant, as a salesman. He slowly worked his way up through the ranks of the company until last month he became the first western CEO of the Olympus group.
Unfortunately for Mr Michael Woodford his new position lasted for only 2 weeks before he was fired from his position as CEO and according to media reports was told by the Olympus board to “get a bus to the airport”.
A western CEO of a Japanese company is extremely rare and a CEO being fired after only 2 weeks is probably even rarer.
According to the Olympus board, Mr Woodford was fired for “causing problems for decision-making”.
Mr Woodford didn’t hold back from giving his version of the story and he claimed that he was fired for in effect being a high level “whistle blower”.
After his appointment as CEO he started asking questions about payments Olympus had made to financial advisers for Olympus’s acquisition of Gyrus, a British medical equipment company, for $2bn.
The interesting thing was that advisory fees of nearly $700m were paid to a Cayman Islands registered company called AXAM whose owners were not identified by Olympus.
The really interesting thing though was that the advisory fees paid were equal to nearly 33% of the total acquisition price. This figure of 33% seems a tad high when compared to the industry average for such acquisitions of between 1% and 5%.
The really, really interesting thing though was that AXAM disappeared from the trade register 3 months after receiving their final payment from Olympus.
Now, I’m not a detective but there are some fairly chunky corporate governance issues in this one and a payment of $700m to an “anonymous” Cayman Islands company which has since disappeared probably does warrant a bit of a debate to say the least.
Mr Woodford won’t be involved in those debates though as his position as CEO was abruptly ended after 2 weeks.
The Olympus share price fell nearly 50% in the days immediately after the announcements.
Olympus has denied any wrongdoing.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-24 17:26:102011-10-24 17:26:10It doesn't make a good photo if you're fired does it?
Those marketing guys can be a creative bunch and the 2012 Olympics will be a great opportunity for them to show off their skills.
The Olympic organisers though are worried that some people may show off more than just their skills.
Ambush or guerrilla marketing is where companies which are not official sponsors of events such as the Olympics try to get their advertising message across without paying any sponsorship money to the organisers.
We’ve blogged elsewhere about Hugo Boss and Bavaria beer’s attempts at ambush marketing so what are the Olympic organisers worried may happen next year?
The London Olympic Games and Paralympic Games Act 2006 (the UK law in connection with the Olympic Games) is being changed to try to prevent people from using their bodies as mobile advertising boards.
At the last Olympic Games in Athens a man invaded one of the diving events with a brand name written across his bare chest.
Olympic organisers are worried that ambush marketing may go one step further and people may “streak” naked at an event with advertising slogans written across their bodies.
Whilst a naked spectator running across an Olympic event will no doubt get the press cameras clicking it’s not something that the Olympic authorities and the official sponsors would appreciate.
The change to the legislation could result in a person that undertakes guerrilla advertising at the Olympics by using advertising on his or her body being fined £20,000.
My personal view though is that this is nothing for the organisers to worry about. Given how cold the British summers are I doubt there will be many people willing to take their clothes off at the London Olympics and run as a mobile advertising board…
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-19 16:17:412011-10-19 16:17:41Would you look at this advert or not?
An Ernst & Young (EY) partner has been rather naughty. In fact, I should straight away say that he quickly became a former EY partner as soon as EY found out what he had done.
So, what did he do?
Well, put it this way but it wasn’t the most professional of things to do.
The Public Company Accounting Oversight Board (PCAOB) is the main “watchdog” of the US auditing profession. As part of their quality review procedures they look at samples of audit working files of registered audit firms.
EY were selected for a review and in particular the audit of one of the clients of Peter O’Toole, an EY partner who had been with the firm for 20 years.
Now, it appears that Mr O’Toole’s work on this particular client wasn’t exactly complete and he tried to hide the fact that the work was incomplete by going back to the audit files and doing a quick “tidy up“ before the PCAOB visit.
Working together with a senior manager (who unsurprisingly is also now no longer with EY), Mr O’Toole created fake documents about work they said they had completed hoping that these fake documents would go unnoticed and the PCAOB would sign off on the audit files.
Alas for Mr O’Toole the backdated fake documents were identified and his dishonesty was found out.
If there’s one key lesson from this it’s probably that it’s best to be honest and not try to cheat with things.
As a result of faking the documents, Mr O’Toole lost his job of 20 years with EY, was barred from auditing for 3 years by the PCAOB and had to pay a civil penalty of $50,000.
If instead of trying to falsify things he had simply owned up to his mistake the chances are that he would have had a “slap on the wrist” and would still be in his job.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-17 10:11:572011-10-17 10:11:57Would you have done this if you were an Ernst & Young partner?
3 years ago in the middle of the financial crisis when some of the best known banks in the world were on the verge of collapsing, the Royal Bank of Scotland (RBS) was rescued by the British tax payers to the tune of £45 billion.
Since then the bank has been under a lot of scrutiny. Not just from the point of whether it would survive but also when it would turn things around so that the business became profitable and the tax payer would start to get their money back.
Along with lots of other companies that have suffered in the crisis, RBS has undertaken a cost cutting exercise over the last couple of years.
Chris Kyle, the CFO of the Investment Banking division of RBS yesterday announced some additional cut backs to his staff.
An internal memo to his staff told them amongst other things that:
– No-one will be given a new Blackberry phone or other handset.
– There will be no magazine or newspapers subscriptions (I guess this now means that they won’t be able to do the daily FT crossword over morning coffee in the office)
– People working late in the office will not be able to claim a taxi expense to take them home unless they are working past 10pm (it used to be a 9pm cut off)
The bank has also banned all staff entertaining for the rest of the year so there will be no bank funded Christmas party for the RBS investment bankers and instead the bankers will have to pay for their office Christmas party themselves.
Now, whilst some people will think this is good cost control some others may feel that this is just “window dressing” to give the impression that the investment bankers’ excessive remuneration and benefits are being stopped.
Some of the RBS employees may well be a bit upset about having to pay for their Christmas party but last year over 300 key staff within the bank reportedly shared a bonus pot of £375 million which equals an average bonus of over £1.1 million each.
I guess these particular individuals are quite relaxed about buying their own Christmas drinks…
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-14 18:05:322011-10-14 18:05:32Sorry to break the news to you but Christmas is cancelled...
Not so long ago the finance profession was predominantly a male one.
At the risk of showing my age, when I first entered the world of work the senior roles in the company I worked for were completely dominated by men.
Things are rightly changing though and in most countries around the world the younger generation that are now entering all business functions appear to be more evenly balanced between the two sexes.
This opening up of opportunities to both men and women can only be a good thing. Any form of discrimination whether it’s discriminating on the basis of race, gender or religion is not only morally wrong but can also result in valuable parts of the working population being overlooked for jobs.
KPMG is one of the top firms in the world and they appear to be getting their gender equality sorted out.
Despite being in the finance and consulting industry which in previous generations was dominated by men, their latest set of promotions indicate that woman are “fighting back”.
KPMG in the UK has just announced the appointment of 29 new partners and 88 new directors.
Prior to their announcement the proportion of female partners working for KPMG in the UK was 14%. Out of the new promotions though, 24% of the new partners and 30% of the new directors are women.
“We are also very pleased to be able to improve the gender balance amongst our partners. We are genuinely committed to enabling more women to reach senior positions.”
So, whilst the number of female partners is still in the minority the percentage is starting to get more balanced.
Congratulations therefore to KPMG on this and it does of course raise the question of how long will it be before the balance is completely reversed and 14% of the total partners are men and 86% are women?
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-12 12:54:292011-10-12 12:54:29Is it easier to become a partner if you're a man or a woman?
Born to an unmarried interracial couple, adopted at a young age, dropped out of college and fired from him first major job. Steve Jobs went on to build two billion dollar businesses.
Unfortunately, the iconic face behind Apple lost his battle with pancreatic cancer on Wednesday and the world lost one of the true business greats.
In terms of his impact on business as well as people’s everyday lives, his legacy will be right up there with the likes of other great visionaries who introduced “life changing technology” such as Henry Ford and the mass motor car.
Steve Jobs taught the world many things and whilst there have been, and no doubt will be, lots written on his business methodologies one particular approach of his stands out as far as I’m concerned.
His creations really encase the concept of providing great products but importantly offering real “value” for these great products.
By “value” I don’t mean that they are the cheapest. In fact, they are far from the cheapest but what Apple do provide are excellent products which customers will pay a premium for as they perceive that this additional value the products offer is worth paying for. In classic Michael Porter terminology this could be referred to as “differentiation”.
Steve Jobs had an uncanny ability to spot the next great thing that customers would want and then to develop a product which although relatively expensive would create such “value” that customers would purchase it instead of cheaper options.
If Apple had competed purely on price then there would always be another company which would come along and offer a similar product for a lower price.
As well as the innovative Apple products that have hit our shelves, Steve Jobs will also be associated with the black St. Croix Collection turtleneck sweater that he would wear at product launches.
Since his death there has been a run on people wanting to buy these sweaters and the company that manufactures them, US based Knitcraft Corp has reported a surge in orders in the last 24 hours. Despite a total order run of between 4,000 to 5,000 sweaters many St Croix stores have now run out of stock.
Rest in Peace, Steve Jobs.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-07 09:41:242011-10-07 09:41:24Goodbye to a visionary and creative genius.
One of the real challenges facing a lot of companies at the moment is access to funds.
The economic turmoil over recent years has led to the loan markets largely drying up and without access to suitable cash reserves a number of firms have hit cashflow problems and have gone out of business.
Similarly, a lot of businesses that have wanted to start up in the recession haven’t had access to loan funds to enable them to do so.
The end result is that jobs have been lost.
The global coffee chain Starbucks though think that they may have an answer to some of the funding problems.
They have just launched a campaign to try to stimulate job growth in America by launching a “Create Jobs for the USA” initiative.
They are partnering in this initiative with Opportunity Finance Network (OFN), a group of private financial institutions that provide affordable loans to certain parts of the American population including low-income people and communities.
As well as donating $5 million to get the project off the ground Starbucks are also covering the admin expenses of OFN as well as paying for the manufacture of wristbands which will be given to any of their customers who donate $5 in one of their coffee shops.
Starbucks Chairman and CEO Howard Schultz said “Small businesses are…employing more than half of all private sector workers – but this critical jobs engine has stalled. We’ve got to thaw the channels of credit so that community businesses can start hiring again.”
100% of the donations made will go to OFN to help fund loans to community businesses including small businesses, microenterprises and nonprofit organizations.
Starbucks themselves though have also been a victim of the recession with several hundred stores being closed in the US alone in recent years and some sceptics may argue that this is just a PR initiate by them.
My personal view though is that if this initiative helps to create jobs then it can only be a good thing.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-05 13:01:122011-10-05 13:01:12Can I have a skinny latte, a blueberry muffin and a corporate loan please?
Michel Barnier, the European Union’s top financial services policymaker, has reportedly drafted a green paper which is expected to be presented to the European Parliament later this year.
If the proposals included within the paper are actually implemented it would mean a radical shake up of the Big 4 business models within the EU.
Mr Barnier has been quoted in the press this week as declaring that “auditors are the dog that did not bark during the crisis and their role has been put into question”.
His proposals are pretty significant and they include preventing the Big 4 from doing any non-audit services such as undertaking consulting work, providing legal advice, running training courses or performing bookkeeping services (or at least not providing these to their audit clients).
The argument behind this is that it would prevent potential conflicts of interest where for example, the auditors are reporting on some consulting work undertaken by their colleagues from their consulting division.
If the Big 4 were prevented from undertaking any non-audit work this would be pretty dramatic for them. It’s estimated that in the UK 67% of their revenue is from non-audit work with only 33% coming from audit work.
Mr Barnier’s proposals also include appointing two auditors for companies with balance sheets greater than €1 billion and at least one of these auditors would need to be a non-Big 4 company.
There is also a proposal to enforce a compulsory rotation of auditors if they have audited a company for a period of 9 years.
Perhaps unsurprisingly the Big 4 have rallied against the proposals (after all, “how many turkeys would vote for Christmas”) but there do appear to be some valid arguments against Mr Barnier’s proposals.
For example, having dual auditors would no doubt increase the cost of the audit significantly.
Whatever the outcome of the proposals when they are discussed at the European parliament later this year, this is a subject which will be debated for many years to come by people who hold opposing views on the matter.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-10-03 02:10:002011-10-03 02:10:00Will the Big 4 firms be completely different next year?
In today’s work environment the pace of life seems to be getting faster and faster. Work and study pressures can all increase the amount of time that we spend at work.
I must admit that I need a coffee in the morning before I’m fully up to working speed.
That kick of caffeine always seems to help get my brain into gear.
Over in the States though it’s been reported that Keith Zakheim, the president of multimillion dollar PR firm Beckerman PR, was a little upset when he got into the office early only to find… (in fact this is so bad that I’m finding it difficult to write)… but he found that there was… wait for it… no milk left in the fridge to go with his coffee.
He was so upset that he sent the following email to his staff
From: Keith Zakheim Date: September 27, 2011 8:20:21 AM EDT To: Beckerman Staff Subject: I don’t know what else to do…
I have repeatedly requested until I am blue in the face that the person that finishes the milk must replace the milk. Its not complicated and is a simple sign of respect for fellow employees.
So, imagine my chagrin this morning when I stumbled in at 715 … only to find that the skim milk in the refrigerator had three drops of milk left. Literally 3 drops, an amount that would maybe fill the tummy of a prematurely born mouse. The person that did this is either incredibly lazy, obnoxiously selfish or woefully devoid of intelligence – 3 traits that are consistent with the profile of FORMER Beckerman employees.
As you can tell from the tenor of this email, I am not happy and at my wits end … and I have repeatedly beseeched you to replace the supplies that you consume – whether its pencils, paper, or MILK. This costs you nothing – I pay for it! Yet, it is still repeatedly ignored.
So, I am gravely serious when I write this – if I catch someone not replacing the milk, or at least, in the case where the downstairs store has close already, not sending an email to the office so the first person that arrives (usually Christa or me) can pick one up upon arrival – then I am going to fire you. Im not joking. You will be fired for not replacing the milk, and have fun explaining that one to your next employer. This is not a empty threat so PLEASE don’t test me.
99% of this office consists of great people that work hard, treat their employes with respect, and understand that they are part of something that is bigger than them. However, there seems to be a small element that doesn’t understand this. So its time that they do or else they should start refreshing their resume.
For those of you who have worked for me for years, you know this is not my style so PLEASE take this seriously!
Thank you for your cooperation.
KZ — KEITH ZAKHEIM | CEO BECKERMAN ANTENNA GROUP
It’s not been reported what happened when Mr Zakheim subsequently went to the biscuit tin and found there were no biscuits in it.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-09-30 16:51:092011-09-30 16:51:09Would you fire somebody if they drank the last drop of milk in the office?
A lot of you will probably have heard of Oracle but probably less of you have heard of Autonomy.
Oracle is a business software and hardware systems company whilst Autonomy develops search software.
Oracle’s Chief Executive is Larry Ellison and Autonomy’s Chief executive is Mike Lynch.
Interestingly enough Oracle’s CEO has recently accused Mr Lynch of lying or in his words of telling “whoppers”.
So, what’s the story behind all of this?
The story began a couple of weeks ago when Oracle’s Elison said that he thought Hewlett Packard had overpaid when they had paid £7bn to buy Autonomy and that Mike Lynch from Autonomy had earlier this year offered to sell Autonomy to Oracle but Oracle had turned it down as they felt it was too much.
Autonomy’s Lynch then said that any discussion of him talking to Oracle about them purchasing Autonomy was “inaccurate”.
Now the previous sentence is quite important as seeing that Autonomy was quoted on the London Stock Exchange, if there was any kind of sales process taking place then Autonomy were required to notify the Stock Exchange about it.
No such notification took place.
After Mr Lynch said that any talk of him discussing a potential sale to Oracle was inaccurate, Oracle responded in quite a dramatic way.
Amongst other things, they released PowerPoint slides of the meeting that Mr Lynch attended and the Oracle statement is entitled “Another Whopper from Autonomy CEO Mike Lynch”.
The statement then goes onto say amongst other things:
“Autonomy CEO Mike Lynch continues to insist that Autonomy was never ‘shopped’ to Oracle. But now at least he remembers and admits to meeting with Oracle President Mark Hurd and Doug Kehring, Oracle’s head of M&A, this past April. But CEO Lynch insists that it was a purely technical meeting, limited to a ‘lively discussion of database technologies.’ Interesting, but not true. The slides Lynch showed Oracle’s Mark Hurd and Doug Kehring were all about Autonomy’s financial results, Autonomy’s stock price history, Autonomy’s Price/Earnings history and Autonomy’s stock market valuation. Ably assisting Mike Lynch’s attempt to sell Autonomy to Oracle was Silicon Valley’s most famous shopper/seller of companies, the legendary investment banker Frank Quattrone. After the sales pitch was over, Oracle refused to make an offer because Autonomy’s current market value of $6 billion was way too high.
We have put Mike Lynch’s PowerPoint slide sales-pitch up on the Oracle website – Oracle.com/PleaseBuyAutonomy – with the hope Mike Lynch will recognize his slides, his memory will be restored, and he will recall what he and Frank Quattrone discussed during their visit to Oracle last April. Yesterday, the Autonomy CEO did not remember having any meeting with Oracle. Today, he remembers the April meeting and inaccurately describes how it came about and what was discussed.
The Statement continued but the key message appears to be that the two individuals are probably not the best of friends and somehow I don’t think the two CEOs will be sending each other Christmas cards this year.
https://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.png00Steve Crossmanhttps://www.theexpgroup.com/wp-content/uploads/2018/06/styleguide-EXP-4.pngSteve Crossman2011-09-28 22:31:112011-09-28 22:31:11How would you feel if you were called a liar on Oracle's website?
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