Corporate Accountability With Case Studies in

Corporate accountability must be examined within the perspective of a company's business challenges. There is a synergy between shareholder value and the responsibilities of management. This book is based on an extensive research project done by the author from 2001 to 2003 in the United States, England, Germany, France, Italy and Switzerland. It includes many case studies on corporate accountability and governance, particularly among financial institutions. Significant attention is also paid to good governance of pension funds.

Dimitris N. Chorafas is an international management consultant and the author of 125 books.

Preface

ix

Part One Corporate Governance and its Responsibilities

1

(116)

1. Principles of Corporate Governance

3

(20)

1. Introduction

3

(2)

2. Corporate governance and its challenges

5

(3)

3. Taking a leadership position

8

(3)

4. Corporate governance and business risk

11

(4)

5. Targeting a high grade by rating agencies

15

(3)

6. Risk-based pricing as senior management tool

18

(5)

2. Corporate Governance in a Market Economy

23

(23)

1. Introduction

23

(3)

2. The global sense of financial markets

26

(3)

3. Distortions in financial markets

29

(2)

4. Leveraging, derivatives risks, and Warren Buffett's opinion

31

(4)

5. Regulatory action for better corporate governance: Basle II

35

(3)

6. Is diversification a fact or an illusion?

38

(3)

7. Dangerous bank-to-bank trades are no sign of good governance

41

(5)

3. Pension Fund Management. A Case Study

46

(27)

1. Introduction

46

(3)

2. Accountability for the safety net. A case study in the auto industry

49

(3)

3. Pension plan blues and the impact on households

52

(3)

4. Privately funded pensions have been damaged by the scandals

55

(3)

5. State and private pensions in Britain

58

(4)

6. State and private pensions in the United States

62

(2)

7. UBS advises that `pension funds should not invest in equities'

64

(3)

8. The many aspects of mismanagement of pensions

67

(3)

9. Legal action against pension fund managers

70

(3)

4. Management's Accountability for Corporate Governance

73

(22)

1. Introduction

73

(1)

2. Corporate governance and internal control

74

(4)

3. Establishing a sound internal control environment

78

(3)

4. Accountability of independent directors

81

(4)

5. Responsibilities of the board go beyond solvency and liquidity

85

(3)

6. Mizuho: woes of the world's largest bank

88

(3)

7. Resona and the oracle of deferred tax assets (DTAs)

91

(4)

5. Scams can Turn Governance into Malfeasance

95

(22)

1. Introduction

95

(2)

2. Scams: from Banco InterContinental to IPOs of the dot-corns

97

(2)

3. The Alpha Plus Fund in the UK

99

(2)

4. Gambling with gold derivatives and the carry trade

101

(3)

5. The Bre-X gold scam

104

(2)

6. Copper bloodbath of Sumitomo Corporation

106

(3)

7. Searching for a scapegoat for the copper scandal

109

(3)

8. Diffused watchdog responsibilities at metals exchanges

112

(5)

Part Two Case Studies on Corporate Governance in the Finance Industry

117

(112)

6. The Salvage of Financial Institutions and Other Entities by the Taxpayer

119

(20)

1. Introduction

119

(2)

2. Lender of last resort and salvage of bankrupt entities

121

(3)

3. Bank default and deposit insurance

124

(4)

4. Protection from creditors under Chapter 11

128

(3)

5. US-style personal bankruptcy and credit risk

131

(2)

6. Legislators, regulators, depositors, bondholders and shareholders

133

(3)

7. The law of unexpected consequences applies to both engineering and banking

136

(3)

7. Case Studies with American Financial Institutions

139

(19)

1. Introduction

139

(1)

2. New laws do not change human nature

140

(3)

3. Frauds which can kill the goose that lays the golden eggs

143

(4)

4. Penalty and disgorgement hitting ten Wall Street banks

147

(4)

5. Is there a massive litigation pending on Wall Street?

151

(2)

6. Challenges faced by JP Morgan Chase and other big banks

153

(3)

7. Corporate governance and payouts at NYSE

156

(2)

8. US Household Debt, Freddie Mac and Fannie Mae

158

(18)

1. Introduction

158

(1)

2. Appreciating household debt and its consequences

159

(4)

3. Freddie Mac and Fannie Mae

163

(3)

4. Financial troubles don't go away by denying them

166

(2)

5. Government-sponsored entities need rigorous supervision

168

(3)

6. Who might be the lender of last resort?

171

(5)

9. Japan Premium: A Case Study on the Rout of Japanese Banks

176

(26)

1. Introduction

176

(2)

2. High leveraging led to collapse of the Japanese economy

178

(3)

3. A bird's-eye view of the status of Japanese banks in 2003

181

(3)

4. The Bank of Japan takes inordinate risks

184

(2)

5. Assets on paper are not the same as those in real life

186

(2)

6. Changed fortunes of Nomura Securities

188

(3)

7. A lesson on good governance: rise, fall and rebirth of the Long-Term Credit Bank of Japan

191

(4)

8. Why a system run on leverage and 'faith' cannot last

195

(3)

9. All nations must learn a lesson from Japan's chronically ailing economy

198

(4)

10. Case Studies with European Financial Institutions

202

(27)

1. Introduction

202

(1)

2. Violations of corporate accountability don't stay secret

203

(4)

3. Poor governance at German state banks could lead to 'German premium'

207

(4)

4. The crisis of German commercial banks is just as deep

211

(3)

5. Bringing Credit Suisse all the way to the abyss

214

(5)

6. Change in management is important, but it takes time to turn around a big company

219

(2)

7. Runaway compensation and trading tricks can kill a firm

221

(3)

8. Beware of mismanagement; it can become endemic

224

(5)

Appendix

229

(2)

Notes

231

(5)

Index

236

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Corporate Accountability With Case Studies in Pension Funds and in the Banking Industry

Summary

Author Biography

Table of Contents

Supplemental Materials

FREE SHIPPING

Rent More, Save More! Use code: BBRENTAL

5% off 1 book, 7% off 2 books, 10% off 3+ books

Corporate Accountability With Case Studies in Pension Funds and in the Banking Industry

Summary

Author Biography

Table of Contents

Supplemental Materials

Digital License