Trust Digest 43 (March 18, 2014) 


Sarbanes-Oxley Whistle-Blower Shield Expanded by Court
The U.S. Supreme Court expanded the reach of a federal law enacted in response to the 2001 Enron Corp. collapse, saying it protects people who work for a public company’s contractors, including law firms and auditors.
Key Words: Sarbanes-Oxley, Whistleblower
Trust Issues: Transparency, Regulation, Stakeholders, Honesty


JPMorgan Whistleblower Gets $63.9 Million in Mortgage Fraud Deal
A whistleblower will be paid $63.9 million for providing tips that led to JPMorgan Chase & Co's agreement to pay $614 million and tighten oversight to resolve charges that it defrauded the government into insuring flawed home loans.
Key Words: JPMorgan, Whistleblower
Trust Issues: Responsibility, Integrity, Transparency, Motives, Honesty, Stakeholders


Nestlé Cuts Chief Executive Paul Bulcke’s Pay Amid Swiss Scrutiny
Nestlé has cut its chief executive’s pay by 7 per cent, becoming the latest Swiss company to show pay restraint ahead of tough rules that will give shareholders a binding say on pay.
Key Words: Nestle, Executive Pay
Trust Issues: Responsibility, Accountability, Regulation


Trust in the Internet 'Now Missing'
Billions of people around the world do not trust the internet, claims European Commission vice-president Neelie Kroes. Following allegations that the German Chancellor Angela Merkel's phone was hacked, Ms Kroes said it was clear that trust was now missing. Speaking at the Cebit tech fair in Hanover, Ms Kroes said the future of the internet was based on trust. "Trust can never again be taken for granted," she said.
Key Words: Internet, Trust, European Commission
Trust Issues: Reputation, Stakeholders


Twitter CEO Costolo to Make First China Visit
Twitter Inc CEO Dick Costolo will meet Shanghai government officials, academics and students in his first visit to China, signaling Twitter's interest in cracking a lucrative but thorny market with 600 million Internet users. Twitter, which takes pride in its reputation for defending free speech and rebuffing government requests for private user data. Costolo's visit comes at a time when the Chinese government, two years into President Xi Jinping's administration, persists in a campaign to clamp down on bloggers and dissident voices on social media platforms like Sina Corp's Weibo, which closely resembles Twitter.
Key Words: Twitter, China
Trust Issues: Communication, Regulation, Motives


Growth in Compensation for U.S. CEOs May Have Slowed
Big U.S. companies appear to have handed out smaller increases in compensation to their chief executives in 2013 than in 2012, mainly as a result of reduced grants of stock options, according to an early review of annual regulatory filings.
Key Words: Executive Pay
Trust Issues: Responsibility, Accountability, Competence, Integrity


Citigroup Cuts Pay of Mexico Chairman
Citigroup Inc. is cracking down on its embattled Mexico business, lowering the pay of the unit's chairman and warning it may cut the compensation of other employees.
Key Words: Citigroup, Executive Pay
Trust Issues: Responsibility, Accountability, Competence


Planet Plutocrat: Our Crony-Capitalism Index
Of the world’s big economies, Russia scores worst. The transition from communism saw political insiders grab natural resources in the 1990s, and its oligarchs became richer still as commodity prices soared. Unstable Ukraine looks similar. Mexico scores badly mainly because of Carlos Slim, who controls its biggest firms in both fixed-line and mobile telephony. French and German billionaires, by contrast, rely rather little on the state, making their money largely from retail and luxury brands. America scores well, too. The total wealth of its billionaires is high relative to GDP, but was mostly created in open sectors.
Key Words: Cronyism, Inequality
Trust Issue: Responsibility


Fighting Corruption in India: A Bad Boom
… it did uncover a massive scam, with hundreds of officials and politicians in the state of Karnataka in the pockets of an illegal mining mafia that, over five years, had made profits of $2 billion or more shipping illegal iron ore to China. Such scandals have rocked Asia’s third-largest economy in the past decade. A lot of transactions that put public resources into private hands—allocations of radio spectrum, for example, and of credit from state banks—have come under suspicion.
Key Words: Corruption, India
Trust Issues: Integrity, Ethics, Corruption


Boards Don’t Know Their Next CEOs
One of the biggest CEO successions of the last decade played out recently in the public eye, as Microsoft went about choosing only its third CEO in the last 39 years. Over a period of more than five months, the tech world's favorite parlor game became guessing the next chief of the software giant until new CEO Satya Nadella was named in early February. But while some called the lack of a ready-to-go CEO a succession crisis, the truth is Microsoft is hardly alone.
Key Words: CEO, Management, Leadership
Trust Issues: Communication, Responsibility, Stakeholders


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