In the past several months, more and more companies have been severely damaged by scandals involving poor or unethical accounting practices. Yet in this same period, there has developed a move on many fronts to reform the system that allowed these practices to take place.
As a result, the spotlight began to shine brightly on the corporate boardroom as the key to the breakdown, but also as the salvation of vastly diminished investor and consumer confidence.
This issue of The State of Business examines corporate governance. Our lead article discusses the New York Stock Exchange's proposed new corporate governance and disclosure standards. The story features the insights of finance faculty members Mike Rebello, a specialist in stock market history, and Omish Kini, who studies trends in corporate boards. Also, Robinson alumni Rick Lenny, chairman, president and CEO of Hershey Foods, and Ken Lewis, chairman and CEO of Bank of America, offer their opinions on whether new guidelines are really the answer.
But what is the view from atop one of this country's major trading organizations? The magazine caught up with A.D. Frazier, CEO of the Chicago Stock Exchange, just as he was leaving to assume a new position as CEO of Caremark Rx Inc. Frazier, a student at Robinson while working for C&S Bank in Atlanta, describes how putting stock price before earnings growth and sprinkling in "a little fear and greed" created a formula for disaster for many companies.
Bob Oxnam recently joined the College as a Robinson Global Scholar with primary responsibility for fashioning the international component of our Executive MBA program. Bob is an Asian expert, and in this issue you'll learn more about his fascinating background as teacher, writer, author and news correspondent. You'll also learn his views on corporate governance in China and find that scandals of Enron proportion are not reserved to the United States.
Rounding out our look at corporate governance is an interview with finance professor Jim Owers. A researcher in the area of earnings restatements, Owers said, "The recent levels of restatements raise questions about the caliber of management (ranging from 'can they add?' to 'are they up to mischief?' or worse) and the efficacy of the auditing profession." You'll want to read more of Jim's thought-provoking opinions in this issue.
With all the doom and gloom that has befallen the economy lately, it is refreshing to know that there is good news in our own backyard. The online counterpart of CFO Magazine, Cfo.com, recognized Robinson's Finance Department as having one of the nation's "10 Most Intriguing Programs." Specifically, the publication referred to the department's CFO RoundTable as one component that made our program distinct. In this issue, Ernie Swift, director of the RoundTable, talks about what makes this group so special.
Finally, Rajeev Dhawan shares his take on the economy in
an article titled "The Long and Short of the Crisis of Confidence." We also include our regular features related to faculty accomplishments and media highlights.
If you are looking for extraordinary insight and frank, informed opinion, you've found it in this issue of The State of Business. As always, your comments are welcome and appreciated.
Sidney E. Harris
Sidney E. Harris
Dean
Robinson College of Business
