Rockefellers To Big Oil: Thanks For The Memories
“There is no sane rationale for companies to continue to explore for new sources of hydrocarbons.” And with that flourish, the Rockefeller Family Fund, which owes its largesse to oil, is divesting its holdings in fossil fuels, including in Exxon Mobil, a descendant of the Rockefeller-founded Standard Oil. Divestment doesn’t always have an economic impact on the entities being divested, but it does send a signal, sometimes a loud one. In a statement, the family explicitly called out the “morally reprehensible conduct” of ExxonMobil. When we hear about active investors, we often think of big egos and boardroom battles. It’s heartening to be reminded how investors can aim to make change for the good, too. This isn’t just a one-family thing, either. The Guardian famously divested, as have a number of universities and religious organizations. The overall divestment movement hasn’t had apartheid-level impact yet (even though it has Desmond Tutu’s support), but you can sense things moving that way. When the chief economist of the American Petroleum Institute says the movement “truly disgusts me,” you can tell he’s worried.
Culture Trumps, Well, Pretty Much Everything
There was unnecessarily risky trading going on Credit Suisse Group and CEO Tidjane Thiam didn’t know about it (Bloomberg). That led to its markets business reporting a first-quarter loss. You’d not be alone if you rolled your eyes after learning that Thiam is shocked that risky trading is going on at a trading firm, but what’s more interesting — and welcome — is what Thiam identified as the problem. “There needs to be a cultural change because it’s completely unacceptable.” There’s no reward without risk, but the top dogs at a firm like Credit Suisse need to make clear what is acceptable and what isn’t. “A lot of the problems in the investment bank have been that people have been trying to generate revenue at all costs,” Thiam said. Now that he’s recognized it, let’s see what he does to create a culture that won’t stand for it.
Build Your Company To Last, Not Your Board
If you’re on a corporate board, there’s an increasing chance that you’ve been sitting in that cushy chair for quite a while. A new report from the Wall Street Journal finds that at nearly one-quarter of major U.S. companies, most directors have been in place for at least 10 years. That’s up from 11% in 2005. The average age of an S&P 500 Board member is now 63 — and aging. Just two S&P companies have average ages below 50 and they’re both Internet companies (TripAdvisor and Facebook). Institutional memory is a good thing and can add perspective to decision making, but it also creates an overly chummy environment that doesn’t necessarily put the needs of the company first.
Dyson Goes Electric
You might be surprised to learn that Dyson appears to be developing an electric car (Guardian). Its brand is built on innovative new products, but it’s a big jump from vacuum cleaners to a car. Even more intriguing is that Dyson is doing so with public funding (a £16 million grant from the UK government, with far more possibly in the works), something most developers in the U.S. haven’t had much luck securing. With so much of the action in electric vehicles happening in the U.S. and Asia, this move by a European government and company to get into the game suggest that they see this currently niche technology headed for the mainstream, far beyond the 1% market share electric cars have on the Continent right now.
Insanely Clueless
Much of the coverage of the Apple announcement early this week focused on its lack of sizzle (although the backlash against that interpretation has begun), but what caught our attention was how Phil Schiller, the company’s senior vice president of worldwide marketing, used some of his time on stage to make fun of people who can’t afford Apple’s high-margin products. Twitter is weighing in, of course (Daily Dot). It’s surprising to see the opposite of empathy from an executive at a business that’s been built around just that.
Photo: Soliven Melindo
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