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Posts Tagged ‘Governance’

Corporate governance at Petronas: Drilling and nation-building

Malaysia’s national oil firm is successful but remains mired in politics

A DECADE after opening, the Petronas Twin Towers in Kuala Lumpur are no longer the world’s tallest. But Petroliam Nasional, the company that built them, continues to grow. It exports lots of liquefied natural gas (LNG) to booming Asian neighbours and owns the world’s largest fleet of LNG tankers. It is also expanding abroad: last year operations outside Malaysia brought in 42% of its M$264 billion ($77 billion) revenue, up from 35% in 2005. Foreign oil giants are keen to team up with it in risky places like Iraq. In short, Petronas is a successful example of a national oil company, the government-owned entities that collectively hold some three-quarters of the world’s proven reserves but are prone to waste and mismanagement. Yet it still faces a peculiar set of problems tied to its state-owned status.

Like oilmen everywhere, Hassan Marican, Petronas’s boss, is busy trying to pare costs in a global slump. From his perch on the 80th floor of Tower 1, he sees little sign of a sustained recovery in demand. He has asked contractors to cut costs by 30% after profits fell by 14% last year, the first drop in seven years. “Everyone knows how much we’re being squeezed,” he says. …

Germany’s flawed corporate governance: Boards behaving badly

Why the leading citizens of corporate Germany are so scandal-prone

THE streets of Germany’s main cities still throng with shoppers; no shops are shuttered. Much credit for that is due to the country’s famed industrial champions, which have been model corporate citizens throughout the recession, keeping employees on the payroll and investing for the long-term. Yet many of them are also remarkably scandal-prone. Big companies such as Deutsche Bank, Deutsche Telekom, Deutsche Bahn and Lidl have been caught spying on workers, journalists or board members. Siemens has confessed to bribing customers and MAN is being investigated for the same. At Volkswagen, a manager was caught paying off a member of its supervisory board. Schaeffler and Porsche are in trouble after launching murky, ill-conceived takeovers involving derivatives and mountains of debt. Yet these two seemingly contradictory aspects of German corporate behaviour may be opposite sides of the same coin.

One reason why Germany’s biggest firms have not cut many jobs is its cherished model of stakeholder capitalism, which took root after the second world war and contributed to its rapid economic growth until the 1980s. Under this model, workers’ representatives fill half the seats on firms’ supervisory boards. A separate management board is responsible for running the business day to day. Companies are also required to act in the interest of all “stakeholders”, not just of shareholders. …

Craig Newmark: Serious advice from Candi Harrison re online governance

Okay, Candi’s has worked a lot on this, and now she’s free to speak out regarding real advice and experience in  Now the Real Innovation…

In conversation with Jeffrey Sachs

Leading economist and director of Earth Institute discusses aid and global warming


Pak ‘biggest collateral damage of Afghan war’: Imran Khan

Cricketer-turned-politician Imran Khan has termed Pakistan as the ‘biggest collateral damage’ of the US-led Afghan war, and said the Pakistan Army is fighting against its own countrymen.
Talking to journalists at a Meet-the-Press event here, Khan said governance in Pakistan has collapsed completely and foreign investment has suffered a severe set back due to the ‘war [...]

Bank boards come under scrutiny

Canary Wharf skyline

The boards of UK banks and the role they played in the credit crisis are expected to come under scrutiny in a report due out later on Thursday.

Analysts say the review of corporate governance, by ex-City regulator Sir David Walker, may pave the way for boardroom practices to be overhauled.

The report, commissioned by the Treasury, is tipped to focus on the way risk is managed at banks.

The issue of pay and how it is linked to risk is also likely to be addressed.

Sir David has spoken to banks, institutional investors, and experts in remuneration and corporate governance in preparing the report – due out at 1000BST on Thursday.

Focus

After many, including MPs, questioned the level of banking experience of some directors at firms – Sir David is tipped to set out plans for directors to have higher levels of skill and to receive formal training.

And after Royal Bank of Scotland was led to near collapse by Sir Fred Goodwin, it is expected that Sir David will recommend that bank boards will be forced to show they are able to challenge a chief executive who they feel is endangering a bank.

There may also be a call for non-executive directors at banks not to hold too many posts, for fear that they are unable to give sufficient time and focus to the financial institutions.

The Walker Review, which will go out for consultation, comes as the City watchdog, the Financial Services Authority continues its inquiry into the crisis which ripped through the UK banking system last year.

The measures in the report were foreshadowed by the Treasury’s white paper on financial regulation, published last week, which announced a radical shake-up of the regulatory system for banks.</p


This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.

Citi Close To Secret Deal With Regulator

Citigroup is close to a secret agreement with one of its main regulators that will increase scrutiny of the US bank and force it to fix financial, managerial and governance issues.

More on Citibank

America engages

By Michael Zubrow

Barack Obama shakes hands after addressing Ghana's parliament in Accra, 11 July

With a series of rousing international speeches, President Barack Obama has definitively recast American foreign policy, shunning the Bush administration’s leadership-centric diplomacy and engaging directly with the people of the world.

In Prague, in Cairo, in Moscow and now in Accra, Mr Obama has translated his campaign message of shared values, hopes and dreams into an ambitious foreign policy agenda.

He has rejected calls from within the US for an inward turn.

Even as the international economy deteriorates and challenges to American power loom ever larger, Mr Obama has chosen to vigorously push for two grand goals – a world free of nuclear weapons, and the spread of good governance and development.

This, then, is the bold but simple approach of the Obama administration – rally the people of the world to take on the most challenging issues of our generation.

Public diplomacy

Barack Obama’s weapon of choice is public diplomacy, speaking plainly and persuasively, directly to the people.

While President George W Bush was well known for relying on close relationships with heads of state, President Obama’s rhetoric is aimed at the ruling elite and the common citizen alike.

In Cairo and Moscow, Obama spoke at prestigious local universities to highlight the importance of future generations that are growing more interconnected and interdependent by the day.

In Prague he referred to the strength of the people of a different generation, exclaiming: "That’s why I’m speaking to you in the centre of a Europe that is peaceful, united and free – because ordinary people believed that divisions could be bridged, even when their leaders did not."

Mr Obama’s outreach has not been limited to international speeches.

His use of public diplomacy has included a message to the Iranian people on Nowruz (the New Year holiday) and the vastly expanded use of technology to communicate with the world.

New emphasis

The focus of Mr Obama’s ambitions is also a marked change from the Bush administration.

While the Bush administration was consumed by the wars in Iraq and Afghanistan, Mr Obama’s major international speeches have largely ignored those deeply unpopular conflicts, instead focusing on the grand vision of reducing nuclear weapons and spreading good governance.

In Prague, Mr Obama spoke of the path to a nuclear-free world and his determination to foster "the right of people everywhere to live free from fear in the 21st Century".

"President Obama has made one thing overwhelmingly clear – America’s participation in solving the most challenging issues of our day is not optional"

In Cairo, he directly took on the issue of an Iranian nuclear programme, linking non-proliferation to America’s responsibility to draw down its own nuclear arsenal.

In Moscow, Mr Obama turned his words into action, securing further progress on joint Russian-American nuclear reductions.

The challenge of nuclear proliferation is hardly new, but rarely has it received such sustained presidential attention since the Reagan-Gorbachev era.

Mr Obama’s attention to global governance is another departure from President Bush’s freedom agenda.

Instead of the former administration’s overwhelming focus on elections as a panacea for better governance, Mr Obama stresses the importance of institutions.

In Accra, Mr Obama called for institutions that are transparent and reliable, noting that good governance is "about more than holding elections – it’s also about what happens between them".

Indeed, the administration’s choice of Ghana for the president’s first trip to sub-Saharan Africa was instructive.

Bypassing Kenya, the homeland of his father, Mr Obama cited Ghana’s institutions and stability as a model for Africa.

Shared values

Even without these two bold goals, Mr Obama’s plate is more than full.

He faces two wars, nuclear challenges from Pyongyang and Tehran, a continually evolving extremist threat and a daunting set of domestic problems.

The administration’s ambition (and focus) extends beyond these challenges to diverse issues like Middle East peace and global climate change.

But President Obama has made one thing overwhelmingly clear – America’s participation in solving the most challenging issues of our day is not optional.

These problems threaten the peace and stability of the world and we simply cannot pass them off to the next generation.

The future President Obama describes is one where America leads through example, not intervention.

His approach emphasises the emergence and importance of local organisations and institutions contributing to solving global problems.

With the US tied down in two wars and beset by economic hardship, Mr Obama envisions a different type of American leadership.

By emphasising shared values and interests he hopes to spark a renewed interest in mutual responsibility and coordinated global action. In these complex times only global action can bring global results.

Michael Zubrow is a foreign policy expert at the Center for a New American Security, a non-partisan, independent, national security think tank in Washington, DC.</p


This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.

Larry Diamond: Obama and Democracy in Africa

No American president has ever spoken so candidly on African soil about the real roots of Africa’s development malaise.

Obama Ghana Speech: FULL TEXT

Here are President Obama’s remarks, as prepared for delivery, from his speech to Ghana’s parliament, Saturday July 11, 2009.

Good morning. It is an honor for me to be in Accra, and to speak to the representatives of the people of Ghana. I am …

Katine’s six-month progress review

Amref’s latest six-month report claims successes in school enrolment and health, but lack of drugs and the small number of farmers benefiting from livelihoods work remain challenges

Read the six-month report, financial review and the report highlights

Read Madeleine Bunting’s mid-term review of the Katine project

The number of children in school has risen by 17% and diarrhoea cases in children under five years old have dropped dramatically, according to the latest six monthly update from the African Medical and Research Foundation (Amref) on the Katine project.

At the start of the project in October 2007 enrolment stood at 7,531 and it has now gone up to 9,071. Some of the increase is due to the expansion of two schools set up by their communities, but Amref claims this is a result of their work in the sub-county. Amref believes that the increase has seen many orphans and children with special needs getting into school; nearly 30% of school-age children in Katine fall into this category. The rise in school enrolment is a boost for the project, which has organised training for teachers over the last 18 months as well as contributing over 1,000 more textbooks and new desks. Classrooms and schools have been renovated or rebuilt and Amref claims there has been a drop in teacher absenteeism, an ongoing problem in remote rural areas, which badly affects educational achievement.

The decline in diarrhoea cases also marks a positive outcome for Amref’s strategy of community health workers, the report claims. The village health teams (VHTs) have been trained and motivated with gifts of bicycles, T-shirts and gumboots. Nine out of 10 patients at the health centre are now referred by the VHTs, which are working effectively to assist the management of a wide range of health conditions such as TB and HIV. But the report acknowledges that the lack of drugs to treat common illnesses such as malaria is hampering the success of the health teams. It reflects the government’s inadequate drug supply system across the country; Amref has insisted that the project’s aim should be to strengthen existing drug supply systems, but this is not proving effective. It is probably now the single biggest challenge of the three-year project. There are also not enough drugs to treat HIV and to prevent mother to child transmission. Other aspects of the health programme have also proved ineffective; the take up of contraceptive services has been tiny, reflecting strong cultural prejudices.

Other successes include a new laboratory at Ojom health centre, which can process tests for malaria, TB and HIV, the report states. Within the first six weeks of the lab opening, 790 patients had come for tests, usually for malaria and HIV indicating the enormous unmet demand for effective healthcare across the Katine sub-county. Another success is that there has been a sharp increase in the number of pregnant women coming for antenatal care – although few of them manage the recommended four visits. It is the long distances and inadequate transport that limits the number of visits a woman makes; it can be as much as 25km to reach the nearest health centre in the sub-county.

Given those distances, the improved immunisation rate – which has now more than doubled according to Amref’s report – is a big achievement. VHTs have played a major role in ensuring that the outreach clinics in schools and trading centres are well attended.

Amref has given some thought about how to deal with the resentments caused by the fact that only a small number of farmers are benefiting from free seeds and tools (about 540 out of the sub-county population of 25,000). Recipients will now be expected to pass on to neighbours a proportion of their first crops as a way of spreading the benefits.

The big challenge that lies ahead in the second half of the project, the report comments, is how to manage the high demands of the community and local government officials. In particular, the water and sanitation budget for hardware (as opposed to training) is exhausted, but there is still considerable demand to expand the services planned to build new boreholes.

There are a number of problems with construction; one contractor of a school at Kadinya has failed to finish the task and lawyers have had to be brought in, the report acknowledges. Some pipework on the rain harvesting has not been fitted properly; and a plastic panel latrine block was blown over in a storm and will now be rebuilt in brick. Construction work is due to begin at a number of other schools, but the more collaborative approach (with community donations of materials) has proved slow.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds


Reviewing Katine: governance

To mark the midway point of the Katine project, and ahead of mid-point reviews to be conducted by our independent evaluator and Amref, this week Madeleine Bunting examines progress in each of the project’s five components. In her final review she looks at governance.

Read Madeleine’s reviews of health, education, water and sanitation and livelihoods

Empowerment has been the strand of the project that us journalists have found the hardest to understand. What exactly is empowerment, and how is it going to be measured or evaluated? I’ve listened to Joshua Kyallo, Amref Uganda’s director, explain how villagers can be empowered to demand better services from the government at district level. But there are plenty of questions in my mind as to how effective this will be in improving the operation of state services in Katine.

The district budgets for health and education, for roads and water are desperately inadequate. It is not just the lack of demand for services that causes the state to be so ineffectual at village level here. I find the “rights-based” approach, based on developing in villagers a sense of entitlement to basic health and education, hard to understand. Katine may put more pressure on the district, but there are multiple problems at every level of Ugandan government; often the district can do very little.

There are other aspects of empowerment that also need to be questioned. I talked to a few Katine residents – not those recruited as volunteers by Amref – and the way they spoke seemed to indicate that Amref was well regarded, but there was no great enthusiasm. I felt that in some places there was a gentle disappointment settling in. Several of the Amref staff spoke of how they had struggled with huge expectations of the project from Katine villagers. Is that the Guardian’s fault, I asked, with its headlines promising “transformation”? Perhaps partly, they agreed.

I wondered how actively Amref has managed expectations and how widely it had communicated with villagers across this very scattered sub-county about what the project was going to do and what it was not going to do. Joseph Malinga’s story about the confusions in a particularly remote corner of the sub-county, Merok, seemed to point to an important breakdown in communications. How was it that this kind of misunderstanding was not corrected by Amref earlier?

There is a sense that Amref decided what it wanted to do in Katine and the extent to which local people – beyond the local government officials – have been involved in that strategy is unclear. There is clearly a tension here between giving people what is known to be good for them – hygiene training – or giving them what they keep asking for – cows. The only way to square this circle is constant communication and explanation and from the outside it is hard to see how well Amref is doing that.

The concern is that given the considerable demands the Guardian makes on Amref – for information and visits – the priority has been to communicate with London rather than the remote hamlets of Katine.

What we need to know

How well are local people being involved in the project?
How much say have they had in shaping its priorities?
Is Amref’s relationship with the Guardian distorting the project?
How does empowerment in the long run help deliver better services?

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds