Showing posts with label US. Show all posts
Showing posts with label US. Show all posts

Thursday, April 04, 2013

B&E This Fortnight

INTERNATIONAL
BUSINESS, ECONOMY & FINANCE
Hello moto!

In a move that will instigate its full fledged entry into the telecommunications hardware business, the global search giant Google is set to buy Motorola Mobility for a staggering $12.5 billion. If approved, this will be Google’s most expensive acquisition ever. The deal will boost Google’s mobile OS – Android. Since its launch in 2007, Android has been installed in 150 million devices. Further, more than 550,000 devices join the Android ecosystem daily through a wide network of 39 manufacturers and 231 carriers spread over 123 countries. It’s an all cash deal where in Google will be paying $40 a share – a 63% premium. The deal will put Google in the competition zone with Apple, Nokia and Research in Motion, resulting in significant competitive advantage. The deal is supposed to close by end of this year or early 2012 subject to regulatory approvals in the US and EU. Even after the deal, the Android platform will remain open source as Google plans to operate Motorola Mobility as a separate business entity. The mobile major currently holds around 17,000 patents and the deal will enable Google to better protect Android from anti-competitive attacks from Microsoft, Apple, and other companies. The development will create phenomenal synergies that would enhance the Android ecosystem.

AIG sues BofA
American International Group (AIG) has filed a $10.5 billion lawsuit against Bank Of America (BofA) over the sale of residential mortgage backed securities that are allegedly marred by fraud, misrepresentation and omission. The claim, which is one of the largest to raise its head in the aftermath of the 2008 financial crisis, blames BofA and its subsidiaries to have issued defective mortgages to borrowers who were not in position to repay, packaged them into supposedly low risk securities and sold $28 billion worth to AIG using offering documents that misrepresented the quality of the loans. Despite the huge losses incurred from the collapse of the mortgage market, very few claims have been filed over the past three years. Last year, Goldman Sachs paid $550 million to settle allegations from Securities and Exchange Commission (SEC) for its alleged fraud in marketing of mortgage backed securities called Abacus, which the company did not admit doing.


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
For More IIPM Info, Visit below mentioned IIPM articles

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Wednesday, March 06, 2013

Throws light on Czech’s post-USSR relations with Russia

In an exclusive conversation with Akram Hoque and sayan ghosh, H.E. Miloslav Stasek, the Czech Republican Ambassador to India, shares his views on EU, NATO and US and throws light on Czech’s post-USSR relations with Russia.

B&E: How are your relations with post-USSR Russia?
MS: We accept each other. We understand Russia is a superpower. It is a very important source of energy because most of the oil and gas coming to Czech Republic is sourced from Russia. In this perspective, Russia is our strategic partner. However, Russia must accept that we are an independent country now. The political dynamics of central Europe have completely changed. We are a member of Western Europe now. The issue of establishing American defence systems is being addressed and we are having regular discussion with Russia on this front. With the new American administration in place, Barack Obama is now thinking of a new system which could handle this issue.

B&E: There are strong rumours that Czech Republic wants the loans ($10 million) back that it gave to Communist countries like North Korea under your Communist regime. Your comments?
MS: We want all our money back (laughs)! After the collapse of the communist regime, we would like to settle all our debts unofficially with all the countries. The money loaned out was invested in some projects that were initiated through the government. We are now talking to international institutions like IMF to find a solution for this issue. North Korea is not the only country where our money is. There are countries like Sudan ($11 million) and Bolivia where these issues need to be settled.

B&E: There has been negligible criticism over hate-crimes against minority groups like Gypsies. Is the Government bothered about this?
MS: The government is bothered and we have assigned one of our ministries the charge of this entire issue. The ministry is focussing on how livelihood of Gypsies can be improved. They have all the rights like any other citizens. The problem is the integration of Gypsies in the national society because they live in cross communities. They don’t send their children to school even for basic education. So the challenge is to change their mentality. That is also a problem with US and Canada.

B&E: As an Ambassador, what are your plans for fortifying relations between India and Czech Republic?
MS: I will do all I can to enhance the extended relations we have with India. I will try to enhance people-to-people, economic, cultural, security and military cooperation. There is a huge potential and we would like to benefit from the economic development of India.

Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri
and Arindam Chaudhuri (Renowned Management Guru and Economist).

For More IIPM Info, Visit below mentioned IIPM articles

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Tuesday, December 04, 2012

A piece on Israeli grandmothers!

And on why mothers and grandmothers of this great nation play a critical role in the Israeli-Russia spar

Since August 28, 2008, almost all western media in some or the other form, are criticising Russia’s decision of recognising the independence of Abkhazia and South Ossetia [once considered part of Georgian influence] by considering it Russian-occupied territories. Not only have both Fortune and Economist featured Russia’s growing influence on their cover stories in the last few weeks, even global leaders have suddenly started recognising that Russia still exists. In sarcastic criticism, US Secretary of State Condoleezza Rice expectably showed her support to Georgia and warned Russia, “In contrast to Georgia’s position, Russia’s international standing is worse now than at any time since 1991...” How interesting dear Ms. Rice that you use that year as an example, for we believe that for the first time since 1991, Russia is finally regaining its rightful position on the world platform. And please Ms. Rice, neither you nor your favourite ‘Kiss Army’, of whom you are a self-confessed die-hard fan, are even an iota interested in what happens in Georgia, are you ma’am?

But what we wish to impetuously implicate out here, and what has been missed out by a majority of media in the process has been the emergence of a strange spar between Israel and Russia over the Georgian war! Analysts and experts in both Israel and Russia are bombarding each other with anti-Russian and anti-Israel statements respectively. Even in the media, while on one hand, Israeli press is accusing Russia of increasing its arm trade with the Middle East, on the other hand, the Russian media is leaving no stone unturned to prove the presence of arms and Israeli training hubs in Georgian land. And now, gravely serious political leaders allege that Russia’s nuclear fuel supply to Iran’s Bushehr nuclear plant is an initiative against Israel and Georgia. The question is, why is Israel suddenly getting into the benign act of protecting Georgia?


Source : IIPM Editorial, 2012.
An Initiative of IIPM, Malay Chaudhuri

For More IIPM Info, Visit below mentioned IIPM articles.

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Monday, August 27, 2012

WOMEN EMPOWERMENT: ARMY

Army’s stand is perplexing

Even Indian paramilitary forces viz. BSF, CRPF, ITBP and CISF maintain special Mahila battalions posted at borders! A contingent of around 120 women CRPF were deployed in Liberia, which prominently features among war torn nations of the world, a few months back. And since our forces are also facing a staff crunch (close to 15,000 officers across the armed forces this year), the step appears all the more illogical.

In countries like New Zealand, Canada, Denmark, Finland, France, Germany, Norway, Israel, Sweden and Switzerland, women are already in serving the armed forces and taking part in combat roles too. US and UK don’t allow combat roles, but permanent commission is a reality.

A number of arguments are being given by proponents of the army’s stand. For instance, it is brought forward that women are especially vulnerable in combat roles, and that the army’s experience with women officers is too little to be able to gauge its operational impact. Even if you choose to agree to the combat logic, it still doesn’t justify refusal to grant permanent commission. Surely the army can be more transparent on their perplexing stand on this issue.


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Thursday, August 23, 2012

THE WORLD TODAY CAN ONLY IGNORE STAKE HOLDER ACTIVISM AT THEIR OWN PERIL

BE IT LEE SCOTT, RICHARD PARSONS, AKIO TOYODA OR HOWARD SCHULTZ, CEOS OF THE WORLD TODAY CAN ONLY IGNORE STAKE HOLDER ACTIVISM AT THEIR OWN PERIL

With the rise of blogs, such negative backlash can assume alarming proportions. A research conducted by University of Georgia, which studied three anti-brand websites for in-depth analysis: anti-Wal-Mart, anti-McDonald’s and anti-Starbucks, concluded that such blog activism activity actually hurts the company reputation as the word spreads faster than one can imagine. To tackle this form of activism, companies are launching their own communication platforms. According to industry reports, 15.8% (89) of Fortune 500 companies are blogging. Another case in point when discussing consumer activism is Toyota’s recent product recall, which fortunately hasn’t done much damage due to the company’s past reputation. In US, Toyota is facing 200 legal cases due to recalls related to faulty engineering. Contrast this with the fact that there are zero lawsuits against Toyota in Japan. Interestingly, Japan’s most famous consumer activist Fumio Matsuda is frustrated because there has been no consumer outburst pertaining to the recall in Japan. He says that the revolutionary activism he had ignited in Japan decades ago has lost momentum. According to Matsuda’s blog, “The Japanese these days are defending Toyota as though it is getting bashed unfairly.”

Employee Unrest becomes Activism

In today’s times of uncertain business fortunes, it is often natural for employees to feel that they are getting the shorter end of the stick. This is increasingly evident in China, where activism is actually getting well organised and hence dangerous for the establishment with associations being formed and legal advice also being sought. The younger lot of migrant workers there are far more aware of the happenings around the world and about what their rights should be, a trend with workers across the globe. Among the complaints of workers is the misuse of the ruling on the minimum wage by the government of 1100 yuan. Often, that’s all that owners provide them. Wages are not the only bone of contention in such cases. In a bizarre twist of events, 800 workers at the Carlsberg brewery went on a five day strike on April 8, 2010. The reason was a new company policy that put a ban on the drinking of beer during work hours. Earlier the workers were entitled to three free beers a day, which was brought down to just one during the lunch break. The strike caused the brewery to halt operations and delay domestic shipments for two days. This policy change by Carlsberg was a healthy and positive step but it faced huge agitations from workers. The strike at BA in 2009 was more about retrenchment policies. BA decided to reduce its staff strength by about 5,000 by March 2010, introduce changes to staff contracts and carry out a 2-year pay freeze plan. This led to huge disagreements between the workers union and the airline management, which led to cancellation of BA flights between December 22, 2009 and January 2, 2010. The 12 day planned strike by the cabin crew cost BA $5.6 billion, not to forget the loss on the reputation front. It is indeed risky to ignore employees in today’s time.

Green Activism

Exxon’s Valdez oil spill in March 1989 was one of the biggest man made environmental disasters before the current BP oil rig leak (refer to the special coverage on BP in this issue). It occurred when an oil tanker on its way to Long Beach California hit Bligh Reef and “Eleven million gallons of oil spilled into Alaska’s Prince William Sound; killing hundreds of seals, thousands of otters and hundreds of thousands of seabirds. Alaska’s marine life is still eating oil from the spill two decades later,” says John Hocevar, Oceans Campaign Director, Greenpeace USA. After the event occurred, all the blame was put on Exxon for the horrible disaster and Exxon was held responsible for loss of livelihood (fishermen) and wild life in the Alaskan region, “When the spill occurred, Exxon lied, covered up as much information as possible, and also enlisted an army of lawyers to fight the claims of fishermen and other injured parties. Of the plaintiffs in the litigation, over 6,000 died in the 20 years it took to settle the claims, ” says Dan Strickland, Bristol Bay Fisheries Liaison for Alaska Marine Conservation Council. And as the BP case shows, an environmental disaster can be even more damning in today’s time and age.

Relevance of the green word today hardly needs a mention. It may not even need a disaster at times. Wal-Mart is an acknowledged ‘enemy’ of the environment by green groups. Part of the problem is its size itself, which automatically means a huge carbon footprint attributable to one irresistible target company. Its logistics in US alone involves a mammoth number of 7,000 tractors and 50,000 trailers. The company was slapped with fines for environment damage across 9 states in 2004 and has come under fire for alleged water pollution, greenhouse emissions, et al. It responded by unleashing a campaign in 2005 under the then CEO Lee Scott, which also laid out a target to reduce greenhouse emissions in its operations by 20% in seven years and improve fleet efficiency by 25% in three years. Now Wal-Mart makes it a point to highlight its green initiatives. While the scepticism persists, the lesson cannot be missed. If you are taking actions on the environment front, ensure that the world knows. Genuine intent is important; a strong communication campaign all the more.



          
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Friday, August 03, 2012

PROF. JAMES L. HESKETT, BAKER FOUNDATION PROFESSOR, EMERITUS, HARVARD BUSINESS SCHOOL

In State capitalism, does the operative word “capitalism” come in? State capitalism and State-run enterprises are neither to be applauded nor feared, writes prof. james l. Heskett of harvard business school

There seemed to be little concern among respondents that States will use their sovereign funds to foster their political interests. Russell Widener comments that ,“I would worry more if they began to use their scale of economy to shake and shift markets.” One advisor to two sovereign funds, Jack Cramer, points out that at least in his experience “the funds are... in no sense aggressive or eager to lead in a sector. As a rule, they want safe investments.”

The current boom in State capitalism stems, in part, from investment opportunities in developed countries. Nari Kannan suggests that it is a product of “thoughtless consumerism (the thirst for cheap Chinese goods) and dependence on foreign oil,” particularly in the United States. But the phenomenon isn’t limited to US. As Kamal Gupta comments, “Countries like India... need investments in infrastructure. Where does it get the money it needs? From the money owners. How does it matter who they are?”

Could global financial markets accommodating state (and private) capitalism be improved? Yes, according to several respondents. Shann Turnbull points out that “National governments can deal with globalisation as they can determine the rules of ownership and control applicable in their jurisdictions.” Nevertheless, he proposes the creation of a “Community Investment Code” to be administered by the World Trade Organisation. C. J. Cullinane comments, “We need global guidelines and regulations as well as transparency.” Jacoline Loewen, concurs, saying that “There may not be global rules for State Capitalism yet, but these will come because the market is demanding transparency.”

The question remains as to whether States make very good capitalists. As investors, they are “systematically inefficient – from a profit maximisation standpoint.” As Paulo Wilson Rodrigues puts it, “State-owned enterprises are less profitable... for one reason: State administrators are less motivated.” Mixed motives may get in the way of long-term financial performance. If this is the case, do we view the success or failure of State capitalism, even if the emphasis is on capitalism, through too narrow a prism? Are State capitalists a different breed of investors? Do their behaviours pose any kind of long-term challenge that needs to be addressed now? What do you think?


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