Microsoft has been fined by the European Commission. Getty Images
Jaron Lanier is a “partner architect” at Microsoft but he doesn’t speak for the software company. As the scientist, composer and author explained to an audience at The Economist’s Technology Frontiers conference on Tuesday, what he says “probably horrifies any number of individuals within the company”.
Even so, in retrospect, it his hard not to read some of his remarks differently, in the light of the European Commission’s €561m fine for Microsoft, confirmed on Wednesday, for breaching a high-profile competition agreement with the European Union. Read more
There are plenty of interesting ironies raised by the news that investment banks are charging asset managers up to $20,000 an hour for access to chief executives, often unbeknown to the executives themselves.
One is that chief executives themselves are no strangers to “cash for access”. It’s a perennial political “scandal” that big corporate donors to political parties get to rub shoulders with the prime minister or his cabinet at private parties and dinners. The last time such a hoo-ha erupted, in 2012, the FT wrote that prominent City figures were “bemused at the outrage” surrounding the affair, describing it as “a healthy part of the democratic process”. One said: Read more
As politicians, members of the European Parliament are justifiably proud of the bonus cap they have agreed to impose on bankers. They seem to have found a politically expedient, legally watertight, electorally popular way to use their limited powers to whack high finance where it hurts. That doesn’t mean that the measure, if confirmed, won’t have potentially grave consequences.
It will increase banks’ fixed costs, weaken the link between pay and performance, accelerate the inevitable drift of financial know-how and power from Europe to Asia, and instantly conjure up a thousand more complex, lawyer-driven alternative compensation structures to get round the rules. Read more
What strikes me about the findings of the UK Competition Commission’s inquiry into the audit market is that in a world of ever more rapid change, a company’s relationship with its auditor is now often the oldest fixture in the boardroom.
Think about it. The commission says 31 per cent of blue-chip FTSE 100 companies have had the same auditor – almost invariably one of the “Big Four” – for 20 years or more. During that period, on average, most companies will have changed their chief executive at least four times, their non-executive board members (assuming replacement at the nine-year mark, when they lose their independence according to UK guidelines) twice, and their computer systems probably five or six times. Read more
If I were a mastermind seeking to undermine the City of London, I would shift Germany’s financial centre from Frankfurt to Berlin, just as the country moved its political capital from Bonn in the 1990s. Then it would be part of a cosmopolitan city where foreign bankers and lawyers might actually want to live.
Adam Posen’s attack on the management and culture of the Bank of England may be the strongest yet, but it is by no means the first – and won’t be the last – criticism of a persistent and dismaying lack of robust governance at the UK central bank.
What is astonishing is that despite countless warnings – three independent reviews, several newspaper editorials and sundry MPs’ warnings – the central charge that the governor is over-mighty and under-governed still stands. Read more
Some years ago, when I was the media editor of the FT, I used to deal with one David Cameron, the public relations executive of Carlton, a large broadcasting company. Since then, Mr Cameron has become prime minister of the UK while I have stayed roughly where I was.
The saga of Florida’s “hanging chads”, which prolonged the disputatious US presidential race of 2000 well beyond polling day, also left corporate America hanging.
Like a man with a broken umbrella trying to hail a cab in a downpour, the maker of the famous black London taxi is clinging to its last shreds of hope. Last week Manganese Bronze announced it was no longer a going concern and intended to appoint administrators.
Next week, the Financial Services Authority is due to announce tighter listing rules to deter abuses by London-listed companies. There is cause for disquiet: this week’s implosion of Bumi , the Indonesian coal-mining group part-owned by Nathaniel Rothschild, the financier, follows governance wrangles at the Kazakh-focused Eurasian Natural Resources Corporation.
The “fit and proper” test is regulators’ and professional associations’ tool of choice for assessing suitability for office – a spirit-level for acceptable conduct.
Asked to choose between government intervention in the delicate business of innovation and government withdrawal from the field, I always used to plump for the latter.