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Issue No. 141 | 21 June 2002 |
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Bitter Pills
Interview: The Fels Guy Solidarity: Life or Death? Unions: Back to Basics International: Global Terror History: Sorry Business Technology: Future Active Satire: Executive Presents PowerPoint Eulogy at Mother�s Funeral Poetry: Santa Claus Was Coming to Oz Review: Dial 'M' For Minority Report
The Soapbox The Locker Room Week in Review Bosswatch
 Tanya IncTom Bites BackRoot Canal Therapy
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Bosswatch Who Wants To be a Millionaire?
Millionaires On The Rise More good news for the top end of town, with a global report showing the number of millionaires around the world grew last year to 7.1 million despite the global economic downturn and difficult financial market. The 2002 World Wealth Report, published this week by Cap Gemini Ernst & Young and Merrill Lynch found that 200,000 individuals joined the ranks of the wealthy in 2001. But the authors of the study said it was clear that the 3 per cent increase in the number of millionaires represented a slowdown from prior years - poor ducks. The United States accounted for 2.1 million of the millionaires, or nearly 30 per cent of the total, the survey found. There were 100,000 high net worth individuals in Australia at the end of 2001, up slightly compared to the previous year. (Source: The Australian) NAB Forks Out For Homeside Trio Amongst the group of winners were three sacked National Australia Bank executives who last year took the blame for more than $3.6 billion in losses from its HomeSide debacle have walked away with a $8.3 million in termination payments from Australia's biggest bank. NAB chairman Charles says the payments were "a necessary step" in resolving outstanding matters related to the disastrous mortgages arm, whose operating assets were sold in December to Washington Mutual. NAB is not the first Australian company that has signed lucrative contracts to match US pay scales, only to have worn big costs when severing ties with those executives. Lend Lease last year paid $15 million after parting with US real estate investment boss Sheryl Pressler after just a year, while AMP paid a total of $13.2 million to its departing chief executive George Trumbull in 1999. (Source: SMH) Enron Skims A Coll Billions But that's nothing compared to the whopping $1.34 billion top Enron Corp workers reaped in payments and stock in the year leading up to its bankruptcy filing. Representatives of former workers and shareholders responded angrily to the bankruptcy court filing, accusing the 144 senior managers of essentially raiding Enron's coffers while leaving their clients with relatively little or nothing at all. Besides the executives pay and awards, Enron funded a retention bonus plan late last year with $US50 million to keep 76 employees "deemed critical" to the energy company's wholesale trading operations (Source: The Australia) ASIC Wants More From One.Tel Elite Meanwhile, the masterminds of the One.Tel ncollapse face a dwindling fortune, with the compensation claim facing top managers of the failed telecom doubling to $93 million. Lawyers for the Australian Securities and Investments Commission told the NSW Supreme Court this week that the increase was due to further investigations into the company's finances. ASIC is taking action against former One.Tel managing directors Jodee Rich and Brad Keeling, finance director Mark Silbermann and chairman John Greaves. It alleges they breached their duties and wants creditors to be compensated for the company's plunge in value before it finally collapsed in May last year. ASIC also wants the four men barred from managing or being a director of any company. (Source: AAP) Board Supervision Issue On Agenda Some good news is the push in the US to prevent company directors have any financial ties with companies they govern. It follows the release of a survey by the Investor Responsibility Research Centre, which advises US fund managers on governance issues. They say a substantial majority of directors should have no ties to a company to ensure the overseeing of management. The bankruptcy of Enron, where half the directors had business or financial relationships with the energy trader, underscored the danger shareholders face when a board does not challenge the management. Since then, companies including Wal-Mart Stores and Ford Motor Co have enhanced independent board supervision. (Source: The Age) ASX Attacked Over Listing Proposal Meanwhile, a leading shareholders' advocate group has attacked the Australian Stock Exchange for not adopting North American proposals to amend their listing rulings to improve corporate governance. The Australian Shareholders' Association says it's disappointed the ASX and the Securities Institute of Australia had reacted negatively to recent proposals by the New York and Toronto stock exchanges in regard to corporate governance. The proposals include the need for companies to have a majority of independent directors, obtain shareholder approval for all share option compensation plans and ensure board audit and compensation committees comprise only independent directors. The ASA says the ASX weakened its listing rulings two years ago by allowing companies to introduce executive option plans without shareholder approval. (Source: NineMSN) Now That's a Job Cut! And the cleaver award for the week goes to British postal operator Consignia which has announced it is cutting 17,000 more jobs as part of its restructuring plan. The group, which had already announced 15,000 jobs losses in March, said it lost STG1.1 billion ($A2.84 billion) in 2001. Unions, already up in arms over Prime Minister Tony Blair's plans for public services, have threatened strike action over the job cuts, accusing Consignia of ruining a once-profitable business. Consignia, which was formerly known as The Post Office, also said it would change its name before the end of the year to its original name, Royal Mail. (Source: ABC Online)
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