News and Analysis

Salacious, Salaries of Super-CEOs

Financial News
Wednesday, 05 September 2007

Corpobligation: CEO's or corporate leaders in the for-profit sector are receiving salaries over 30 times higher than in the non-profit sector

  • Sarah Anderson, Christian Science Monitor has written a book and article that states: handlittlemoney.jpg
    • "Overall, the 20 highest-paid executives of publicly traded corporations make, on average, 38 times more than the country's 20 highest-paid nonprofit leaders."
  • Salaries are supposed to motivate behaviour and theoretically compensate handmuchmoney.jpgemployees for their contribution to a business, but how can salaries over 100 times those of the average employee be justified?
  • Limits on CEO salaries could be based on reducing corporate tax deductions based on a multiple that relates CEO salaries to the average employee's earnings.
  • Where is the corporate obligation? Corporate directors have an obligation to shareholders to look after their best interest. Can they justify astronomic salaries?
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Novartis, India and Patents

Company News
Tuesday, 28 August 2007

Corpobligation.com: Battling PR campaigns over the future of drug access, production and patents

  • A fight over the patentability of a cancer drug (Glivic, Gleevic, Imatinib) produced by Novartis has led to a wider debate around patents over drugsglivec.jpg
  • Patents are Good: encourage innovation and risk taking, by preserving long term profits
  • Patents are Bad: prevent access to drugs because the patent holder charges more than generic drug makes would charge
  • Novartis challenged Indian patent law for failing to provide sufficient protection from the competition under WTO rules
  • Groups like Medicins Sans Frontieres (Doctors without Borders) disagreed arguing that drug access was vital for worldwide health, especially in developing countries
  • Corporate Obligation? Did Novartis do the right thing strategically? They donate many treatments in India (99% according to their site) of Glivic and they have been upfront with their position; yet, a worldwide coalition formed to attack them. How can NGOs and governments create incentives to drive drug innovation?

 

 

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CSR and Satire - Yes Men

Opinion
Friday, 24 August 2007

Corporation Obligation: CSR is ripe for satire - can it change behavior?

A few years ago, the Yes Men made a film that shook the halls of power...or at least the reputations of various media outlets and corporate reputations.

The Yes Men are set on "impersonating big-time criminals in order to publicly humiliate them." Some recent "hijinks" include a mock WTO Proposal for slavery in Africa and a Keynote address at a major Canadian oil company conference:

"We need something like whales, but infinitely more abundant," said "NPC rep" "Shepard Wolff" (actually Andy Bichlbaum of the Yes Men), before describing the technology used to render human flesh into a new Exxon oil product called Vivoleum. 3-D animations of the process brought it to life.

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No fun when TNCs abuse toy makers

Human Rights News
Tuesday, 21 August 2007

Corpobligation action: TNCs should pressure suppliers, but should not abandon them

  • China Labour Watch released a detailed report about the labour abuses of 8 Chinese toy companies.left_behind_doll.jpg

  • Should there be a recall of the products? Or compensation to workers?

  • Ironically, Mattel recalled millions of products because of the potential of lead paint to harm children in the United States; yet, in cases where workers have certainly been harmed, the odds of a human rights related recall are low. But what about a human rights return action by consumers?

  • The report provides excellent recommendations including: do not abandon supplier factories, but rather commit to them and be resolute in making sure that violations are corrected. Not only take responsibility for their suppliers’ legal infractions, but go a step further and strive to actively improve its workers’ lives.

  • Spelling note: labor (USA) labour (Rest of english world).

  • How does this relate to corporate obligation? Labour conditions are possibly the area where corporations can take the largest role, especially, when they are prompted by NGOs like China Labor Watch.

  • Question: When will human rights abuse of workers be as important as potential harm to children?

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University checks hire with political parties

uninews
Friday, 17 August 2007

Corpobligation: Governments contribute funding to universities, should they vet appointments by partisan terms? Have funding realities destroyed academic independence?

  • Not wanting to be pedantic, of course academic independence has been undermined by financial realities: universities sign exclusive agreements with Coke, drug companies name buildings, professors have to seek their own research funding from companies and the government.

  • UBC was seeking to hire a Vice-President of External and Community Relations: “Former Tory MP John Reynolds was asked whether the appointment of Liberal MP Stephen Owen as vice president would be a “problem” for the university.”

  • Link Article in the Globe and Mail

  • Where does corporate obligation come in? Universities have obligations to at the least ensure academic independence. It is a little frightening to see universities spending funds on lobbying.

  • Isn't UBC just acting like any rational actor? Perhaps, the mistake was to get caught? See related

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Professor Marc Spooner: Universities losing face?

uninews
Wednesday, 15 August 2007

Corpobligation: Universities losing face?

  • How should universities screen donations?

  • Naming a noteworthy building or a street after an individual is one of the most visible ways society can recognize outstanding achievements that contribute to the public good. Institutions like hospitals and universities make similar gestures when they name wings or programs after individuals whose career dedication or financial contributions leave a legacy that benefits future generations.”

  • ...have we really come to the point where even a university’s good name is up for sale at the right price like some “rebranded” hockey arena?”

  • See Marc Spooner's article, “Universities losing face: Sign of the times?”

  • Where does corporate obligation come in? Universities are often faced with the opportunity to receive “donations” from corporations, which seek to bolster their brand and invest in basic research and training for their future employees.

  • Question: When should universities take or refuse a donation? Is any money too dirty? See related

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Can Indonesia make CSR mandatory?

Legal News
Friday, 10 August 2007

CO: Indonesia has passed legislation making CSR mandatory for resource firms, now it has to figure out what that actually means

  • The Jakarta Post reported the passage of the legislation on July 21, 2007csr_police.jpg

    • Article 74 of the law provides that a company that operates in any business field related to natural resources is required to institute social and environmental responsibility programs, and that sanctions will be imposed on non-compliant firms

  • Article 74 is obviously vague but it shows the government's intention to enforce CSR despite corporate objections. At a minimum, Art. 74 seems to require that companies put in place programs that fulfill social and environmental responsibilities. If the government adopted a reasonableness standard, the minimum standard could be based on best practices and comparative standards from other countries.

  • See the reaction of the Wall Street Journal and the surprising acceptance by Indonesia business groups below

  • The question is what is Canada waiting for before it actually adopts the CSR Roundtables Recommendations?

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