Corporate Eye

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Ed Konczal

Ed Konczal

Conveying Credibility and Corporate Strategy

Campbells logoThere is a company known to nearly everyone in the US –Campbell’s. The company has been in business for 140 years. Quite an accomplishment.

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Campbell’s website is indicative of a well run company. First, on the Our Company page we see a reference to their “Success Model”, but notably there is even a link to a rare product problem. This is unusual indeed, and contributes to the visitors perception of credibility and trustworthiness.

Campbells Annual Review
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Next there is a separate page for the “Success Model” (going to the Annual Review, integrated into the corporate site).

Noteworthy is the visibility and commentary from the two top executives. 

There is also a further discussion on the three components of the success model; click on each component and more information is displayed. Nicely done: the company does a good job explaining how this model drives corporate strategy.

It is interesting to note that there is another display of the success model in the Corporate Social Responsibility report for 2010—

Campbells on integrity
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Integrity is added and a link to a comprehensive comprehensive Code of Business Conduct and Ethics is provided. While this addition is laudable, I suggest it should be prominently displayed with the other three components throughout the site.

In sum, Campbell’s conveys credibility and transparency as well as an engaging way of communicating their success model.

Tales From Corporate Governance Surveys

There is always something happening in Corporate Governance.

Two recent notable items are —

corporate governance

KPMG and the New York Stock Exchange-Euronext recently offered IPO Bootcamps for companies considering an initial public offering (IPO). Participating companies were asked to name their top three challenges in preparing for an IPO. The results are a bit surprising. The top three items were –

  • improving corporate governance (64 percent)
  • preparation of a robust business plan (40 percent) and
  • preparation of financial track record (36 percent).

Often, it’s the small details that companies overlook that can cause headaches down the road. For example, while many companies realize that corporate governance is a demanding issue, when selecting board members, many don’t consider that an important role for directors is working with management to ensure the right tone at the top for ethics and compliance. (Aamir Husain, a partner in KPMG LLP)

This is encouraging. Fostering compliance and ethics at the early stage of a company’s formation increases the likelihood that these issues will be properly executed as the company grows.

The PWC CEO Survey is extensive but some key items stand out:

  • most CEOs outside of financial services believe the economic crisis has not changed public perceptions of their industries. They believe the trust issue is restricted to the banks and isolated to countries that experienced the worst banking crises.
  • The view that companies can rebuild trust through new remuneration models appears to be held by a minority of CEOs from virtually every country.

While small start-up companies realize the importance of trust and ethics, CEOs at large established companies (at least according to the PWC Survey) still don’t get it.

Economic Indicators: Pink Ties and Trash

economic indicator: pink tie

I must admit, I follow announcements of official indicators that measure where the economy is going. These are very involved data gathering and analytical endeavors. Currently they give no definitive picture.

I started to think that there might be other measures that are not compiled, yet might give less analytical but subtle indicators that would give an unofficial account of where the economy is headed. Then I found this article  “Economy: These Below-the-Radar Indicators May Signal Growth” on Bloomberg BusinessWeek. Seems that there are some uncommon economic indicators such as–

  • diesel fuel sales at roughly 7,000 truck stops across the country–climbed 3.1 percent in May from April, the largest monthly increase since February 1999
  • train shipments of waste and scrap materials–increasing at the fastest pace in 16 years
  • electricity usage and the service economy, ( this is compiled by the Edison Electric Institute releases weekly represents certain aspects of the service sector, such as office and retail space). Richard DeKaser, president of Woodley Park Research in Washington, D.C. says–

“When you’re filling up office buildings, and office buildings are working overtime—and the same for retail stores—that’s a good proxy for those sectors.”

This indicator for the week ended June 5 was up 10.8 percent from the same week in 2009.

  • While the the typical employment data is dismal, optimism in recent data concerning temporary workers. The May 25 report by the American Staffing Association showed May staffing employment up 3 percent from April and up 19 percent from a year earlier.

Then there is this article published by Forbes: “Uncommonly Clever Economic Indicators”. These indicators are a bit more interesting–

  • pink ties Bob Allsbrook, chief economist for Regions Bank, in Birmingham, Ala., looks for wisdom in neckwear–specifically, pink ties. … “Since the start of the summer(2009), I’ve seen lots of men wearing pink and fuchsia colored ties,” he notes.
  • the size of restaurant trash bags : Americans are eating out again, and that’s a good sign. You can see that trend in the size of the garbage piles behind restaurants
  • denim jeans sales –NPD market research firm says

    “Jeans are a relatively cheap investment and one of the first things consumers buy when the economy starts to bounce back. … denim sales have already started to pop: For the six months from January to June, denim sales jumped 5.3% to $7.6 billion vs. the same period in 2008.”

  • corporate hotel cancellations — cancellations for corporate meetings and events declined substantially. However, major event planners are booking space for 2010, 2011 and even 2012.

This article includes other interesting metrics such as shopping bags and Christie’s wine auctions.

Want to find out where the economy is headed? Put on a pink tie, get in your diesel truck and drive behind some restaurants.

The Rush To Financial Literacy

In my last post I had a reference to Financial Literacy Education. In Europe this is known as Financial Capability. Many financial services companies are rushing to provide some type of financial education to existing and potential clients. What is behind the rush?

A number of developments converged to produce the 1000 year financial storm–

financial-issues

The global economic crisis, more complex investment choices and the shift of pension investment choices from the employer to the employee, when combined with widespread financial illiteracy, is causing increased stress among a significant number of the public.

Research suggests that 15–20 percent of employees have financial problems severe enough to negatively affect productivity. A financially stressed employee spends an average of 20 hours per month of work time on his/her personal financial problems.

The Case For Financial Education at the Workplace
The Federal Reserve Bank of Kansas City, The Federal Reserve Bank of Atlanta

Too many people fail simple tests on the basics of compound interest and basic financial math. The result: poor financial decisions such as not investing in company-offered voluntary investment plans. This worsens individuals’ financial condition and puts their retirement at risk.

Many financial services companies, banks, credit unions and financial advisory firms are offering a variety of financial literacy education resources.

Some examples in the US

Bank Of America  FINANCIAL TOOLS

Wells Fargo HANDS ON BANKING

CitiBank  FINANCIAL CAPABILITY

Examples from Europe

Barclay’s BUILDING FINANCIAL CAPABILITY

Halifax MANAGING YOUR MONEY

Caixa Galicia SECURE YOUR FUTURE

Some are critical of these programs. They indicate the motivation is to restore the tarnished reputations of the financial services sector. Perhaps, but the educational services offered do assist in helping individuals to improve their knowledge of financial matters.

This subject is important enough to warrant additional posts in the future.

ANZ Bank, the Spirit and the Letter

I enjoy finding a corporate website that stands out from the crowd. My latest finding is ANZ, one of the largest companies in Australia and New Zealand, and a major international banking and financial services group.

The first section I always look for is About Us

ANZ-About

The About Us landing page is comprehensive and well designed. Personally, I would like Corporate Governance to be more prominent, but it is available via the related links section from the landing page.

Once in Corporate Governance, let’s look at what is displayed in this section.

At the top is this statement–

In relation to corporate governance, ANZ’s Board seeks to:

  • embrace principles and practices it considers to be best practice internationally;
  • be an ‘early adopter’, where possible, by complying before a published law or recommendation takes effect; and
  • take an active role in discussions regarding the development of corporate governance best practice and associated regulation in Australia and overseas.

The second and third bulletpoints are remarkable. This is a company that wants to go beyond the “letter of the law”.

The Corporate Governance section Is very comprehensive; however you have to download PDFs to access the information.  Regular readers will know that I would prefer the information to be displayed online with PDF as another option. A must see is the the Continuous Compliance Policy (PDF) which is an explanation of the company’s objective of going beyond Compliance Regulations.

Another interesting element of this site is the Our Company section that is actually the detailed About Us section, and quite a good one at that.

ANZ-C0mpany

Click on Our Businesses and you get a more detailed description of functional and geographic areas of the company.

View Management to obtain a comprehensive background on senior managers.

Select Our Profile to learn more about the company’s strategy, and more.

A noteworthy section nestled within the Corporate Responsibility section is the company’s commitment to enhancing Financial Literacy. This subject is getting global attention due to the demise of personal pensions and the worldwide economic crisis. The company offers extensive education.

In partnership with some of the most trusted community organisations in Australia and New Zealand, ANZ has developed a number of programs that address issues of financial literacy and inclusion. Find out more about our programs:

  • MoneyMinded – an adult financial literacy education program
  • Saver Plus – a matched savings program for people on low incomes
  • Progress Loans – a program offering small loans to people on low incomes
  • MoneyBusiness – a program to improve levels of financial literacy in indigenous communities

Action on financial literacy and inclusion doesn’t only help the community – it helps ANZ too. Find out why.

This commendable suite of programs deserves to be prominently displayed on the homepage. (More about financial literacy in future posts).

But most interesting is the desire to go beyond “the letter” of compliance to “the spirit” of best practice.

SKF Little Glitz, Lots of Content

SKF is one of the leading global suppliers of products, solutions and services within rolling bearings, seals, mechatronics, services and lubrication systems.

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Industrial products – so I expected a more serious corporate website without the “bells and whistles” you see on consumer products and services companies.

Right? Well, not entirely… The company has a video and some interactive items on the homepage, and there are plenty more “bells and whistles” elsewhere. Plus, they do a good job of integrating product information with corporate material here (not always easy).

But the real story is how they present the company.

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First, the About Us section is called This Is SKF. This is only a portion of the page — the company offers too much information to display in one image.

So let’s see the menu on this page:

Pretty comprehensive, and there are bells and whistles all over the place: see Living the Vision and the Power of Knowledge Engineering, and do go to look at the history timeline. The In Focus section has loads of information about the various components of the company (very interesting). And “This website” is something I have never seen on a corporate website: it describes the organization of the website. Much better than a site map.

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Next a visit to Corporate Governance.

The theme of rich content continues here but, unlike other sections, there is too much use of PDFs rather than online sources for my taste.

Suggestion for SKF–apply your overall content strategy in the Corporate Governance section as well as elsewhere.

Despite this minor quibble, SKF’s website is content rich for stakeholders.

Something for everyone…