Tag Archives: transparency

Murdochs cause waves on both sides of the Atlantic

Rupert Murdoch (C) walks from a hotel to his flat with his son James Murdoch (L)Last night I was asked on BBC’s Newsnight, its influential current affairs television program, what Rupert Murdoch should do wearing his corporate diplomat hat given he’s now being pursued by a high-profile range of interested parties — UK Parliament’s Culture/Media/Sport select committee, London’s Metropolitan Police and the FBI who all are very interested in the extent of his company’s phone hacking and police bribery practices.  Is Rupert Murdoch’s defiance going to be seen as a Tony Hayward moment, the former BP executive wanting his life back? Clearly his newspaper brands in the US and UK have a lot more defending to do, with the mere whiff of wrongdoing taking the shine off both News International’s share price and the levels of trust in its brands.  The UK impact of this drama hopefully will result in not only a change in the privacy laws and regulation of the media, but will shine a bright light on the nature of British news media ownership and the dysfunctions that imbalances of market power bring.  Stay tuned!

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FSA’s Fine for Goldman Sachs – What Do You Call A Timid Tap On the Wrist?

As reported by Marketwatch:

Wanted: Lloyd 'Smallfine'

FSA’s fine is less than a slap on the wrist: Goldman Sachs’ fines in both the UK & US represent roughly 7% of earnings this year and 4% of last year’s profits. Goldman shares were
not only up nearly 2% in morning trading on Thursday, they’re up 14%
since the end of June.

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Robert Reich: Why Growth Is Good

Robert Reich: Why Growth Is Good

What will be the fall-out from the predicted global economic slow growth? What brands will survive, succumb or override this sustained downturn? Read this excellent article by Robert Reich and let me know your thoughts:

“Economic growth is slowing in the United States. It’s also slowing in Japan, France, Britain, Italy, Spain, and Canada. It’s even slowing in China. And it’s likely to be slowing soon in Germany.

If governments keep hacking away at their budgets while consumers almost everywhere are becoming more cautious about spending, global demand will shrink to the point where a worldwide dip is inevitable.

You might ask yourself: So what? Why do we need more economic growth anyway? Aren’t we ruining the planet with all this growth — destroying forests, polluting oceans and rivers, and spewing carbon into the atmosphere at a rate that’s already causing climate chaos? Let’s just stop filling our homes with so much stuff.”

Read the full article at:

Robert Reich: Why Growth Is Good.

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BP Oil Spill Coverup: Fishermen Speak Up

Was the BP CEO shuffle a waste of time? Current reports don’t look promising – read Rick Outzen’s report:

While officials claim most of the oil from America’s worst-ever spill has disappeared, fishermen hired by BP are still finding tar balls—and being instructed to hide their discoveries.

Two weeks ago, as federal officials prepared to declare that some three-quarters of the estimated 5 million barrels of oil released into the Gulf over three months had disappeared, Mark Williams, a fishing boat captain hired by BP to help with the spill cleanup, encountered tar balls as large as three inches wide floating off the Florida coast.

Reporting his findings to his supervisor, a private consulting company hired by BP, the reply, according to his logbook came back: “Told—no reporting of oil or tar balls anymore. Don’t put on report. We’re here for boom removal only,” referring to the miles of yellow and orange containment barriers placed throughout the Gulf.

Williams’ logbook account, which I inspected, and a similar account told to me by a boat captain in Mississippi, raises serious concerns about whether the toll from the spill is being accurately measured. Many institutions have an interest in minimizing accounts of the damage inflicted. The federal and local governments, under withering criticism all summer, certainly want to move on to other subjects. BP, of course, has a financial incentive.

The miraculous disappearance of the oil and the pending transfer of $20 billion to Ken Feinberg, who is independently overseeing the claims fund, have resulted in the oil giant cutting back its response operations. With a recent halving of the Vessels of Opportunity program, which hired fallow charter and commercial fishing boats, captains and deckhands are now less reticent to describe their experiences.

This includes Mark Williams, who worked in the program until he was deactivated last week. Williams’ saga is typical. In May, he arrived in Alabama from Atlantic Beach, Florida, to captain a charter boat. He got one day of red snapper season before Roy Crabtree, NOAA Fisheries Southeast regional administrator, shut down the Alabama waters for fishing.

For the rest of June and much of July, Williams worked off and on as a deckhand on boats enlisted in the Vessels of Opportunity program, including a boat called Downtime that in early June first sighted tar balls and oil sheen in the Pensacola Pass.

Williams was also part of the skimming operations at Orange Beach when miles-long mattes of oil washed on to its shores the following weekend. Untrained, Williams remembers putting more than 100 pounds of oil-soaked absorbent boom in debris disposal bags that he was later told should have held no more than 20.

Subsequently, Williams saw seven large shrimp boats, with two Coast Guard vessels accompanying them, five miles off shore. “Plumes were everywhere,” says Williams, referring to thin layers of crude oil floating on the water’s surface. “Every time another boat would approach the shrimp boats, the Coast Guard would get on the radio and tell the boat to veer back to shore.” Williams says he believes the boats were putting dispersant on the oil, even though the Coast Guard has denied using dispersant off the Florida and Alabama shores. “The plumes were gone the next day,” Williams says.

Back in Florida on July 27, his boat, Mudbug, was activated into Vessels of Opportunity. While the media, BP, and the Coast Guard were reporting no more oil, Williams and other boat captains were assigned to find it.

Three days later, Williams found remnants of dispersant in a canal in Santa Rosa Sound north of Pensacola Beach. He reported it to his supervisor, who worked for a company that BP hired to help with cleanup, O’Brien’s Response Management.

Williams wrote in his logbook, “Returned p.m. for check-out. [Supervisor] said, ‘Oh, they sent someone out there and it was algae’—No ****ing way—Idiots.”

O’Brien’s was founded in 1982 by Jim O’Brien, a retired Coast Guard officer, who originally called his firm O’Brien Oil Pollution Service, ironically known in the industry as “OOPS.” Over the years the company has been acquired and merged with other response companies; it was hired by BP and Transocean prior to the April 20 explosion of the Deepwater Horizon rig as an emergency-response consultant.

On Saturday, July 31, Williams found a “tea-type” stain on the water and followed it toward Fort Pickens, which is the western tip of Pensacola Beach. He wrote in his logbook, “We found massive tar balls—both in quantity and size, in small gulley. They ranged from ping-pong ball to coconut in size not 3′ from beach line.”

After that, Williams was taken off spill and tar ball watch and put on boom removal. In an inlet north of Pensacola Beach, his crew sighted more tar balls. He wrote in his logbook: “Middle of Sound to off-load boom. 1″ to 3″ tar balls—floating—must be old—told [supervisor] at end of the day.” That’s when he was told not to make the report, but rather to simply gather up the boom.

“We found massive tar balls–both in quantity and size, in small gulley.”

Williams was deactivated from Vessels of Opportunity last week. Last Tuesday, the day before he was dropped, the boat captain wrote, “Coming back p.m. from Ono Island. Counted 12 oil plumes small in comparison to offshore between range marker and decon barge.” This was a week after Carol Browner, a top energy adviser to President Barack Obama, announced 75 percent of the oil had been contained, evaporated, or dispersed.

Williams never believed the reports that the oil had disappeared. “It’s out there and we will see it continue to wash up on our beaches,” he says.

The Daily Beast received a similar account from the Mississippi Gulf Coast, where commercial fisherman Mike Stewart of Ocean Springs has tried to get state officials to recognize that oil and dispersants remain in the waters off their shores.

Since the first of August, Mississippi fishermen have found oil in the marshes of their barrier islands, seen massive fish kills and scooped up submerged oil in Pass Christian. Nonetheless, Bill Walker, director of the Mississippi Department of Marine Resources, declared on August 9, “there should be no new threats,” and issued an order for all local coastal governments to halt oil disaster work being funded by BP money that was granted to the state.

Walker challenged anyone to prove there was still oil in Mississippi waters by calling his office. As of Friday, August 13, Walker told media that he had not received any phone calls.

“That’s a bunch of bull,” says Mark Stewart in telephone interview with The Daily Beast. “There is oil all through the water column. We’ve proved it, and they do nothing about it.”

Stewart even has a video on YouTube showing his crew dipping an absorbent cloth into the Gulf water three-quarters of a mile off the Mississippi beaches. When it’s pulled out of the water after less than two minutes, the cloth is covered with oil. There is so much oil on the surface that it reflects sunlight like a mirror. There, too, the commercial fishermen are concerned about the dispersants.

“They say the oil is gone,” Stewart said on the video. “We disagree.”

Stewart, a third-generation fisherman, was in Vessels of Opportunity for 70 days before being laid off August 2. He tells The Daily Beast part of his time in the program was play-acting for visiting dignitaries. “Whenever a government official would be flying over our boat, we were told to put out all our boom and start skimming for show, even when there wasn’t any oil.”

The Daily Beast asked BP officials about the shrinking number of vessels involved in Gulf cleanup. BP spokesman John Curry says: “We have no certain number of vessels for the program. It will be adjusted based on the need. Less oil means less resources are needed.”

When asked about Williams’ claims that he had been instructed by O’Brien’s supervisor not to report oil, Curry said, “I am not aware of it. We will work as long as the work needs to be done. You will need to check with the contractor about this specific claim.”

The Daily Beast did contact Tim O’Leary, O’Brien’s vice president of communication services, and relayed Williams’ account. O’Leary says that he is unaware of any issues near Pensacola, but agreed to check further. The Daily Beast gave him until the end of the day for a deadline—O’Leary subsequently left a message that he needed more time to respond. O’Leary’s response was: “We have checked with our on-scene supervisor regarding this allegation. He denies that any such order was given to Vessels of Opportunity participants.”

Correction: This article initially reported 5 billion gallons of oil were released in the Gulf; it has been updated to 5 million barrels.

Rick Outzen is publisher and editor of Independent News, the alternative newsweekly for Northwest Florida.

FT Judgment Call: Can too strong a national identity harm the business?

FT Judgment Call: Can too strong a national identity harm the business?

The problem

BP’s difficulties in the Gulf of Mexico seem to have been exacerbated by a perception that the business is overwhelmingly British. US critics have been irritated by the lack of an American voice at the top of the company. Should businesses try harder to include a wider array of nationalities in senior posts? Or is the call for greater diversity simply a politically correct management fad?

The consultant:  Allyson Stewart-Allen

Promoting your country of origin and heritage is the right thing to do when the country has high credibility in your sector internationally. For
example, promoting “Made in France” for a perfume brand makes sense. Any company doing business internationally must ensure the voices of those diverse markets hit the boardroom, not just because it is politically correct but because research shows diversity results in better decisions and risk management. Ideally, those voices should reflect the countries and business cultures in direct proportion to the level of revenue represented by those markets. A systematic process goes a long way to build and sustain brand value – and we know Americans speak the language of brands fluently.

The writer is director of International Marketing Online, a consultancy

The brand guru Wally Olins

The kind of rhetoric used against BP is politically motivated and intended to deflect anger that might otherwise be used against the US government towards “foreigners” – in this case, snooty Brits. But this won’t last long. Usually the country-of-origin effect is helpful. Mercedes thrives on German “characteristics” – efficiency, reliability. And L’Oréal was run by an Englishman for years – presumably “because he was worth it”. But national identity can cause problems. Toyota’s recent performance has had a knock-on effect for other Japanese companies. This episode shows you need people at, or near, the top of the business who can speak the language and use the style of the countries in which they operate.  It seems that Tony Hayward, with all his understated English charm, can’t.

The writer is chairman of Saffron Brand Consultants

The director Miles Templeman

In today’s business climate, a truly international company must take care to position itself as being internationally representative. Being viewed as just a
national company could inhibit growth in overseas markets. Multinationals need to be seen to be representative of each country in which they operate, with a strong local voice.  Of course, global companies have a national origin, but a purely national identity is not sufficient. BP may not have carried out a great piece of positioning over recent weeks, but it does have a transparently global position – 40 per cent of its shareholders are in the US, for
example – and that global positioning is vital to business success.

The writer is director-general of the UK’s Institute of Directors

Edited by Stefan Stern
Copyright The Financial Times Limited 2010.

My CNN “Connect the World” Interview Highlights on BP’s Uphill Battle to Restore Its Credibility:

BECKY ANDERSON: … At the end of the day, if you were crisis managing for this company and and helping them decide where they go next worldwide and looking at their public image at this point what would your advice be?

ALLYSON STEWART-ALLEN: Firstly, always put forward a local voice. If you’re ever in a crisis again, God forbid, always put forward someone who understands the local landscape and has that local cultural understanding, number one.  Number two, be transparent. You know, why wasn’t the public invited to look at some of the designs for some of these fixes and get the best brains in the United States and around the world who could look at them and say, actually, that one is good, that wouldn’t work.  And get input.

You don’t have to do everything by yourself. And they became very inward looking, very defensive, when, actually, they didn’t have to be. They would have engaged everyone and changed the conversation if we all were invited to contribute something.

BECKY ANDERSON: This is an easy one, Allyson, surely for Obama.  There’s no way he wants to be associated with big oil now, is there?

ALLYSON STEWART-ALLEN: Well, so far it hasn’t really helped him hugely. I mean he’s been getting extremely bad reviews for not demonstrating empathy, not taking action quickly enough. And, in a way, I mean I’m a bit sympathetic about his position, because he has gone there. He’s trying to demonstrate empathy. He’s trying to do what he can. But he is the president of the United States.  He’s not a scientist.