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July, 2006

 

The Color of Money in Sports; America's Money in the Middle East; Does Quarterly Guidance Hurt or Help Companies? CNN: In the Money, July 29, 2006 By Jack Cafferty, Andy Serwer, Jennifer Westhoven, Brianna Keilar, Jim Boulden, Allen Wastler, Valerie Morris
	Over the years, they decided to ask management more and more, for more and more guidance. Management provided that guidance. We've evolved to the stage we're at now, to where it's expected. We think it focuses too much attention as you said on making those pennies and not investing for the long term.
Office Depot - Chairman & CEO Interview Global News Wire, July 28, 2006
	Steve Odland: Well, I think that you are seeing a trend towards less specificity in quarterly guidance. And Office Depot does not provide specific numbers to the analysts for quarterly guidance. Instead what Office Depot believes is that we ought to focus on making sure that people understand our business model and know all the parts of our business and that we lay out our goals in qualitative and strategic terms. I think that having less -- fewer numbers out there inspires better behavior and makes sure that people really focus on long-term performance rather than the "short-term-ism" that is inspired by quarterly earnings guidance.
The Case for Ending Quarterly Reports NPR: All Things Considered, July 24, 2006
	From the financial industry today comes a report called Breaking the Short-Term Cycle, that comes from the CFA Center for Financial Market Integrity and also from the Business Roundtable’s Institute for Corporate Ethics. And its recommendations include rethinking the benefits of companies issuing what are called quarterly earnings guidance.
Just say no to earnings predictions NPR: Marketplace, July 24, 2006 By Ashley Milne-Tyte
	Brian Moriarty: "We've had one executive compare the whole quarterly guidance earnings game to attempting to land a 747 on a postage stamp." Ending earnings guidance wouldn't have to leave investors in the dark. Moriarty says companies that don't issue guidance wind up giving out more useful information, such as real-time sales numbers.
Pepsi did right thing; some don't, experts say Baltimore Sun, July 7, 2006 By Meredith Cohn, Sun reporter
	But not everyone thought that fear of legal repercussions and bad publicity were the only reasons that companies refuse competitors' trade secrets. Some companies want to compete fairly, said Dean W. Krehmeyer, executive director of the Business Roundtable Institute for Corporate Ethics at the University of Virginia. At a recent seminar for corporate executives, he said, a chief executive sitting across the table from a top competitor said he "enjoyed competing on a level playing field" and had tried to instill that in employees. (Also appeared in RedOrbit (formerly RedNova), SmartPros, TMCnet.com)
How can corporate America overcome short-term thinking? A task force of investors and businesspeople sets out to find the answer CFO Magazine, July 12, 2006 By Karen M. Kroll, CFO Magazine
	A 2005 survey of more than 400 financial executives revealed that 55 percent would delay starting a project with a positive net present value in order to avoid falling short of quarterly consensus earnings. In response, a small group of businesspeople has set out to find a cure. In May 2005, the Business Roundtable Institute for Corporate Ethics at the University of Virginia and the CFA Centre for Financial Market Integrity created a task force to recommend ways to combat the fixation on short-term performance at publicly held companies. (This article also appeared on TMCnet.com)
Making ethical business decisions CBIA News, July 2006 By Debra Susca
	Krehmeyer points to the institute’s “Bridge Papers” publications, which convey leading-edge research on business ethics. The most recent publication, Building the Business Case for Ethics, states that “companies do well by doing good.” It also asks the question of how managers can be equipped to meet rising financial and ethical expectations.
US companies seek end to earnings guidance Financial Times, July 24, 2006 By Francesco Guerrera
	The call to end a practice that sets the US apart from the rest of the world will come in a report to be released on Monday by the Business Roundtable Institute for Corporate Ethics - part of an organisation made up of 160 leading US chief executives - and the CFA Institute, which groups more than 80,000 analysts and fund managers. "The obsession with short-term results... leads to the unintended consequences of destroying long-term value, decreasing market efficiency, reducing investment returns, and impeding efforts to strenghten corporate governance," it says. (Also appeared on Borsen (Danish), CNBC, Euro2Day.com, Financial Times Germany, MSNBC and MSN Money and The Australian)
The wrong focus? How the race to meet targets can throw corporate America off course Financial Times, July 24, 2006 By Francesco Guerrera and Krishna Guha
	Today a report by the Business Roundtable Institute for Corporate Ethics, an offshoot of the powerful organisation that groups 160 chief executives of some of the largest US companies and the CFA Institute, the analysts' trade body, will add the influential voices of big business and investment professionals to the chorus of those clamouring for the end of quarterly guidance. "The obsession with short-term performance does not create value for shareholders and in many cases destroys value," says Dean Krehmeyer, executive director of the Business Roundtable Institute for Corporate Ethics, and one of the report's authors.
Earnings guidance - LEX Column Financial Times, July 24, 2006
	Doing the right thing is never easy, especially when few others join in. This makes the latest signs all the more encouraging, that giving detailed quarterly earnings guidance is losing its appeal. Today's report by the Business Roundtable Institute for Corporate Ethics and the CFA Institute of investment professionals is unlikely to prove the last word. But it could mark the end of the beginning. Many of the largest US companies have already given up on spoon-feeding investors with forecasts.
Report: Break Focus on Short-Term Returns Associated Press, July 24, 2006 By Ellen Simon
	Practices including earnings guidance, financial transparency and management incentives should be changed to break Wall Street's obsession with short-term returns, according to a report released Monday by the CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics. (Also appeared in AFX Asia, AFX International Focus, AM New York, Anchorage Daily News, Atlanta Journal-Constitution, Atlantic City Press, Austin American-Statesman, Austin KLBJ, Baltimore Sun, Belleville News-Democrat, Bismarck Tribune, Borsa-Italia, Boston Globe and Boston.com, Bradenton Herald, Business Direct Weekly - Michigan Business Review, BusinessWeek, Centre Daily Times, Clute Facts, CNBC, Columbus Dispatch, Daily Advance (Elizabeth City), Dayton Daily News, Euro2Day.gr, Forbes, Fort Wayne News Sentinel, Fort Worth Star Telegram, Gadsden Times, Galveston County Daily News, Grand Junction Sentinel, Greenville Reflector, Hemscott, Houston Chronicle, iWon Money, Kentucky.com, Los Angeles Times, Las Vegas Sun, Lexington Herald-Leader, Macon Telegraph, Marshall News Messenger, Minneapolis-St. Paul Star Tribune, MLive.com, Modesto Bee, “MSN Money”, My Mother Lode, Myrtle Beach News, My Way Finance, Nacogdoches Daily Sentinel, New York Post, New York Times, Newsday, News Vine, NewsFlash, Palm Beach Post, PhillyBurbs.com, Quote.com (Lycos), Rocky Mount Telegram, Sacramento Bee, San Francisco Chronicle, (SFGate.com), Seattle Post-Intelligencer, Springfield News-Sun, Stamford Advocate, Syracuse Post-Standard & Syracuse.com, The Columbus Dispatch, The Daily Camera, The News-Sentinel, The State, TimesDaily.com, Twin Falls Times-News, Tyler Morning Telegraph, Wilmington Morning Star, Worcester Telegram, WTOP Online, WVEC-TV ABC 13 Hampton Roads, Yahoo! Finance, Victoria Advocate)
Report Calls For Halt To Quarterly Earnings, Pay Reform Dow Jones News Service, July 24, 2006 By Kaja Whitehouse
	The groups are also calling for changes to the way top executives and investment managers are paid to shift the focus to long-term financial goals from short-term results. They also want increased disclosure of fee structures and incentive targets for investment managers, including mutual fund managers and pension fund manager. The Securities and Exchange Commission is in the process of revamping the way companies reveal how they pay corporate executives. The new rules could be in place as early as next year. (Appeared 7/24 in AFX, Boston Globe, Canadian Business, Euro2day.gr, Hemscott.com, Houston Chronicle, MSN Money; appeared 7/25 in Atlanta Journal-Constitution, Arizona Republic, AZCentral.com, Hartford Courant, Kansas City Star)
US Business Roundtable applauds report recommending end to short-term quarterly earnings guidance Finfacts, July 24, 2006 By Finfacts Team
	The US Business Roundtable, an association of 160 CEOs of leading US companies, today applauded the work of the Business Roundtable Institute for Corporate Ethics (www.darden.virgina.edu/corporate-ethics) in developing its report, “Breaking the Short-Term Cycle,” which calls on investors, corporations, asset managers and others to reconsider the benefits and consequences of short-term quarterly earnings guidance.
Push to end obsession with quarterly guidance The Australian, July 25, 2006 By Francesco Guerrera
	A widespread rejection of earnings guidance would mark a major shift in the US companies' relationship with Wall Street and could change the way chief executives and fund managers are assessed and rewarded. The call to end a practice that sets the US apart from the rest of the world came in a report released yesterday by the Business Roundtable Institute for Corporate Ethics -- part of an organisation made up of 160 leading US chief executives -- and the CFA Institute, which groups more than 80,000 analysts and fund managers.
Groups Want to Curb 'Short-Termism' Dow Jones Newswires, July 24, 2006 By Kaja Whitehouse
	"Short-termism cuts across an enterprise and results in management actions ... all in order to make the quarterly number," said a press release issued in tandem with the report. Indeed 80 percent of financial executives said they would decrease their spending on research and development and hiring, among other things, in order to meet short-term earnings targets, according to academic research published last year. (Also appeared in Atlanta Journal-Constitution, Boston Globe and Boston.com, Hartford Courant and CTNow.com, Houston Chronicle, King County Journal, Syracuse Post-Standard & Syracuse.com, Yahoo! Finance Australia & New Zealand, Yahoo! Finance UK & Ireland)
Call to end earnings guidance Investment News, July 24, 2006 By Dan Jamieson
	The CFA Centre for Financial Market Integrity, the policy-setting arm of the CFA Institute in Charlottesville, Va., and the Business Roundtable Institute for Corporate Ethics in Washington said earnings guidance on future performance, as well as some other practices popular on Wall Street, are creating a "short-term obsession" among investors.
Business Roundtable Comments on Short-Term Guidance Report Issued by Business Roundtable Institute for Corporate Ethics Business Roundtable , July 24, 2006 By Tita Freeman
	“The concerns raised by the Institute about the challenges of short-term targets are consistent with the Roundtable’s Principles of Corporate Governance which call for greater focus on long-term performance objectives,” said Steve Odland, Chairman and CEO of Office Depot and Chairman of Business Roundtable’s Corporate Governance Task Force. “While Business Roundtable has not adopted a policy position on this issue, the report provides an important foundation for discussion on an issue that is worth serious examination.” The Roundtable created the Business Roundtable Institute for Corporate Ethics in January 2004, bringing together business school leadership from across the country to enhance the link between ethical behavior and business practice. The Institute, housed at the Darden Graduate School of Business Administration at the University of Virginia, conducts independent research, leads executive seminars on business ethics and develops best practices in corporate and business ethics.
Former SEC Head Supports Efforts Stop Quarterly Guidance Dow Jones News Service, July 25, 2006 By Kaja Whitehouse
	Former Securities and Exchange Commission Chairman William Donaldson supports efforts to get companies to stop issuing quarterly earnings estimates, but he warned groups pushing the issue Tuesday that any move in that direction should be balanced by increased disclosure of other factors, like long-term strategic goals. (Also appeared on EasyBourse.com)
Report assails quarterly forecasts; Groups say 3-month earnings guidance feeds unhealthy short-term ‘obsession' The Globe and Mail, July 25, 2006 By Paul Waldie
	It added that analysts, fund managers and shareholders should also stop demanding short-term results. “This is a two-way relationship. Investors should expect greater influence but must exhibit true ownership behaviour and generally commit to acting like owners (e.g. holding longer, trading less),” the report said. “Similarly, companies should expect longer capital commitments — but only if they provide investors with high-quality communications and a fair voice in governance.”
Misguided guidance - Disclosure is welcome but short-termism is damaging. Financial Times, July 25, 2006
	When both company bosses and fund managers agree that quarterly earnings forecasts harm US business it is time to listen. The Business Roundtable Institute for Corporate Ethics and the CFA Institute say in a new report that the practice "leads to the unintended consequences of destroying long-term value, decreasing market efficiency, reducing investment returns, and impeding efforts to strengthen corporate governance". None of those consequences is good.
Former SEC Chairman Donaldson Says Quarterly Earnings Numbers are Meaningless Associated Press, July 25, 2006 By Ellen Simon
	Imperfections in the accounting system make quarterly earnings numbers meaningless, former Securities and Exchange Commission Chairman William Donaldson said Tuesday.   Donaldson, who chaired the SEC from 2002 to 2005 with a decidedly activist bent, also called for the regulation of the hedge fund industry. Speaking at an event sponsored by the CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics, Donaldson said, "The real issue is to stop managing a company for the quarterly results." (Also appeared on AFX Asia, AFX International, Boston Globe, Canadian Business, Houston Chronicle, MSN Money)
SEC Chairman: Recommendations To End Earnings Views 'Healthy' Dow Jones News Service, July 25, 2006 By Siobhan Hughes
	"These are, in the main, healthy recommendations because concerns with short-termism have been with us for some time, and there are many attendant pathologies," Cox said in a response to a question from Sen. Paul Sarbanes, D-Md., during a Senate Banking Committee hearing. "The problems we've seen with manipulating earnings," Cox said, are "derivative of that kind of short-termism." (Also appeared on EasyBourse.com)
Former SEC chairman Donaldson says quarterly earnings numbers are meaningless The Associated Press, July 25, 2006 By Ellen Simon
	Speaking at an event sponsored by the CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics, Donaldson said, "The real issue is to stop managing a company for the quarterly results." Thanks to assumptions allowed under accounting standards, quarterly earnings numbers "are so vague," Donaldson said. (Also appeared in AFX Asia, AFX International, Arizona Republic (Phoenix), Borsa-Italia, Boston Globe and Boston.com, Canadian Business, Houston Chronicle, MSN Money Central, NewsMax, The Daily Camera, Victoria Advocate and Yahoo! Finance)
Former SEC Head Supports Efforts Stop Quarterly Guidance Dow Jones News Service, July 25, 2006 By Kaja Whitehouse
	Former Securities and Exchange Commission Chairman William Donaldson supports efforts to get companies to stop issuing quarterly earnings estimates, but he warned groups pushing the issue Tuesday that any move in that direction should be balanced by increased disclosure of other factors, like long-term strategic goals. (Also appeared in EasyBourse.com and Nasdaq)
Trade Groups: Dump Quarterly Guidance CFO.com, July 25, 2006 By Stephen Taub
	In addition to ending quarterly earnings guidance, the trade groups called for: • Aligning corporate executive compensation with long-term goals and strategies and with long-term shareowner interests. • Improving disclosure of asset managers' incentive metrics, fee structures, and personal ownership of funds they manage. • Endorsing the use of corporate long-term investment statements to shareowners that will clearly explain "beyond the requirements that are now an accepted practice" of the company's operating model.
In the News: Guidance on earnings guidance The McKinsey Quarterly, July, 2006
	A newly issued report from two major business groups—the CFA Institute and the Business Roundtable Institute for Corporate Ethics—argues that US companies should no longer provide quarterly earnings guidance. This article from the archive takes a similar view.
Kortetermijndenken op terugweg De Tijd, July 25, 2006
	De 160 invloedrijkste bedrijfsleiders op Wall Street, verenigd in het Business Roundtable Institute for Corporate Ethics, roepen nu alle beursgenoteerde bedrijven op hetzelfde te doen. 'De obsessie met kortetermijnresultaten bij beleggers, vermogensbeheerders en bedrijfsleiders vernietigt langetermijnwaarde, vermindert de marktefficiëntie en beleggingsrendementen en verhindert inspanningen rond deugdelijk bestuur', stelt Dean Krehmeyer, een van de co-ateurs van het gisteren gepubliceerde rapport. Krehmeyer hoopt met het rapport ('Breaking the Short-term Cycle') beleggers en bedrijfsleiders weer oog te doen hebben voor de langetermijnstrategie, in plaats van voor de vraag of de winst per aandeel nu één cent boven of onder de prognose ligt.
Wall Street wil af van kwartaalfocus De Tijd, July 25, 2006
	Volgens het kruim van Wall Street werken die prognoses bij beleggers én bedrijfsleiders alleen de 'kortetermijnobsessie' in de hand, waardoor de lange-termijnstrategie uit het zicht raakt. De opmerkelijke aanbeveling komt van het Business Roundtable Institute for Corporate Ethics, dat 160 Amerikaanse bedrijfsleiders verenigt, en het CFA Institute, dat wereldwijd 83.000 analisten en vermogensbeheerders groepeert.
Daily Briefing The Atlanta Journal - Constitution, July 25, 2006
	Two influential groups are calling on companies to stop issuing quarterly earnings forecasts as part of a series of reforms they say will help stifle the nation's "obsession" with short-term financial results. The report was released Monday by a unit of the CFA Institute, a membership organization for investment professionals, together with a unit of the Business Roundtable, a membership group of 160 chief executive officers.
Kvartalsrapporter presser selskaber Børsen, July 25, 2006 By Francesco Guerra
	Store amerikanske selskaber, analytikere og porteføljeforvaltere opfordrer i en ny rapport til at indstille offentliggørelse af kvartalsvise resultatforventninger, idet de mener, at disse resulterer i, at toplederne er for fokuserede på at leve op til forventningerne. Det kan få alvorlige konsekvenser for aktionærerne. Rapporten kommer fra Business Roundtable Institute for Corporate Ethics - en del af en forening bestående af 160 ledende amerikanske topchefer - og CFA Institute, der tæller mere end 80.000 analytikere og porteføljeforvaltere.
Rubriker - Dagens Industri Reuters - Nyheter på svenska, July 25, 2006
	Flera amerikanska storföretag vill slippa lämna kortsiktiga börsprognoser till aktiemarknaden. Det framgår av Business Roud Table Institute for Corporate Ethics. Bland medlemmarna finns cirka 160 storföretags-vd:ar. Organisationen presenterar sin rapport med CFA Institute som i sin tur har 80.000 aktiemarknadsaktörer som medlemmar.
Nouvel assaut contre les prévisions trimestrielles Le Temps, July 25, 2006 By Carole Ulmer
	Un rapport publié lundi par le Business Roundtable Institute for Corporate Ethics, rassemblant environ 160 patrons de grandes entreprises américaines, et le CFA Institute réunissant plus de 80 000 analystes et gestionnaires de fonds appelle à «mettre un terme à la pratique des annonces prévisionnelles trimestrielles» et «à se recentrer sur le développement de long terme de l'entreprise.» Sujet déjà très débattu, cette étude, basée sur dix mois de recherche, vient enfoncer le clou.
Protesta delle aziende Usa contro i report trimestrali BILANCI Il Giornale, July 25, 2006
	Attraverso un documento pubblicato dal Business Roundtable Institute for Corporate Ethics (Brice) e dal Cfa Institute, più di 80mila protagonisti del sistema economico d'oltreoceano hanno proposto di seguire l'esempio di società del calibro di Pfizer, Motorola e Intel, sostenendo che l'ossessione del management delle aziende sul raggiungimento dei target trimestrali non fa altro che danneggiare il valore delle imprese.
Subject: Corporate Governance Alliance Special Edition on Governance Reform The Value Alliance, July 25, 2006 By Eleanor Bloxham and John M. Nash
	As context and of particular interest to those concerned that heretofore good governance and/or governance reforms, on the one hand -- and corporate innovation and informed risk taking, on the other -- diverge, they will be pleased to know that the findings and recommendations of the CFA Institute and Business Roundtable today echo the data and recommendations in the National Innovation Initiative of the Council on Competitiveness.
Industry groups call for corporate reform Investment News, July 25, 2006 By Aaron Siegel
	At a lunchtime conference, William H. Donaldson, former commissioner of the Securities and Exchange Commission and chairman and chief executive of Donaldson Enterprises Inc. in Springdale, Ark., said "Companies are going to be more serious [about long- term growth] if we get to it at the parent company level." "There is an ample amount of evidence that member organizations are interested in the short term," Mr. Donaldson added. "I want to compliment [CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics] for doing what is absolutely necessary. This is a big step forward for big business."
The guidance scapegoat Reuters.com, July 25, 2006 By Marc Gerstein, Director of investment research
	Indeed, an increasing number of companies are already jumping off the guidance bandwagon. A recent survey showed the percentage of firms providing earnings guidance has fallen to about 50 percent from 75 percent a year ago. That poll, by the National Investor Relations Institute, spurred the Business Roundtable Institute for Corporate Ethics and the CFA Institute to call for an outright end to the practice, according to the Financial Times. For analysts, that would mean fewer morsels to chew on in the hunt for milestones.
Industry experts call for earnings guidance reform SNL Insurance Daily Proprietary Articles, July 25, 2006 By Bree Fortney
	The report acknowledges that there may be benefits to providing earnings guidance, but the negative consequences are "significant," and include unproductive and wasted efforts by corporations in preparing guidance, neglect of long-term business growth in order to meet short-term expectations, a "quarterly results" financial culture characterized by disproportionate reactions among internal and external groups to the downside and upside of earnings surprises, and macro-incentives for companies to avoid earnings guidance pressure altogether by moving to the private markets.
Il gioco delle stime stanca Wall Street Il Sole 24 Ore - Finanza e Mercati, July 25, 2006
	Cresce negli Stati Uniti l'avversione per le stime trimestrali sugli utili societari, per quelle «guidance» con cui i manager indirizzano Wall Street sulla redditività a breve. Anzi, un documento redatto dal Busines Roundtable Institute for Corporate Ethics - che fa parte di un'organizzazione di oltre 160 ceo americani - e dal Cfa Institute, associazione cui fanno capo 80mila analisti e fund manager, ha chiesto esplicitamente alle società quotate di abbandonare quest'ossessione per la scadenza a breve, che avrebbe l'effetto di danneggiare investimenti e strategie di medio periodo.
Industry Groups Call for Corporate Reform InvestmentNews.com, July 25, 2006 By Aaron Siegel
	The report calls for changes in earnings guidance practices; developing long term compensation structures for executives; shifting the corporate focus to long term value creation; improving communications and transparency about a company' s strategy; and promoting broad education of all market participants about the benefits of long-term thinking and the costs of short-term thinking. "We view [this report] as a first step and we want to continue on with this and look for additional steps," said Dean Krehmeyer, executive director of the Business Roundtable Institute for Corporate Ethics, who co-wrote the report with Matthew Orsagh, CFA and Senior Policy Analyst at CFA Centre for Financial Market Integrity.
UPS fall shows risks of issuing quarterly forecast Chicago Tribune, July 26, 2006 By Bill Barnhart
	As the second-quarter corporate earnings report train speeds down the track, two pillars of capitalism want to slow things down. The Business Roundtable, a lobbying group for major corporations, and the CFA Institute, the association for financial analysts and money managers, this week urged companies to quit forecasting their quarterly results.
CFA Institute calls for long-term thinking Benefits.ca, July 26, 2006
	"The obsession with short-term results—leads to the unintended consequences of destroying long-term value, which decreases market efficiency, reduces investment returns, and impedes efforts to strengthen corporate governance," the report says. "Our broad set of recommendations—focused on the issuer, analyst, institutional investor, and asset and hedge-fund manager communities—could mitigate the current overemphasis on short-term performance."
La sindrome trimestrali fa male ai mercati Il Sole 24 Ore, July 26, 2006 By Marco Onado
	Lunedì è stato pubblicato un importante rapporto che intende appunto favorire scelte più consapevoli e capaci di garantire l'efficienza di lungo periodo dei mercati e dei sistemi economici in generale. Il rapporto è stato curato da un think tank di rilievo come il Business Roundtable Institute for Corporate Ethics e dall'associazione di categoria degli analisti finanziari, il Cfa, e ha un titolo che è tutto un programma: «Rompere il ciclo del breve termine», affinché le quattro categorie fondamentali di operatori (manager, investitori istituzionali, risparmiatori, analisti finanziari) possano «tornare a concentrarsi sui valori di lungo periodo».
Ennustamisen vaikeus Kauppalehti, July 27, 2006
	Osavuosikatsausten julkistamisen käydessä kuumimmillaan kaksi vaikutusvaltaista amerikkalaistahoa on esittänyt, että yhtiöt luopuisivat tulosennusteista. Yritysjohtajista koostuva Business Roundtable Institute for Corporate Ethics ja analyytikoita ja rahastojohtajia edustava CFA Centre for Financial Market Integrity sanovat, että lyhytjänteiset tulosennusteet vievät huomion yhtiön pitkäaikaiselta kehittämiseltä.
Long live the short term National Post, July 26, 2006 By Terence Corcoran
	For years, but especially since the fall of Enron, the United States has been busy undermining the source of the country's economic power: it's capital markets. From Sarbanes-Oxley to the SEC and through the courts, lawmakers and regulators have been killing the engine behind U.S. economic success and driving the capital markets abroad. Now comes the latest shoot-yourself-in-the-foot strategy from a panel bearing a menacing title: The CFA Centre for Financial Market Integrity and Business Roundtable Institute for Corporate Ethics Symposium Series on Short-Termism.
Clarity can be tricky in US corporate forecasts GulfNews, July 27, 2006
	When both company bosses and fund managers agree that quarterly earnings forecasts harm US business it is time to listen. The Business Roundtable Institute for Corporate Ethics and the CFA Institute say in a new report that the practice "leads to the unintended consequences of destroying long-term value, decreasing market efficiency, reducing investment returns, and impeding efforts to strengthen corporate governance". None of those consequences is good.
USA-jättar vill fimpa kvartalskapitalism Dagens Industri, July 25, 2006
	Amerikanska storföretagsledare vill slippa lämna kortsiktiga vinstprognoser. Mitt i rapportfloden kommer två tunga lobbyorganisationer med ett utspel mot kvartalskapitalismen. "Besattheten kring kortsiktiga resultat får som oönskad följd att långsiktiga värden förstörs, det försämrar avkastningen och hindrar försöken att stärka bolagens styrning", står det i rapporten från Business Roundtable Institute for Corporate Ethics. Bland medlemmarna finns 160 vd:ar i amerikanska storbolag. Och nu har alltså cheferna fått nog.
CFA Centre, Business Roundtable Institute for Corporate Ethics Report Calls on CEOs, Asset Managers, Investors, Others to Adopt Practices to Promote Long-term Value for Shareholders' Benefit, Break 'Short-term Obsession' CFA Institute, July 24, 2006
	The CFA Centre for Financial Market Integrity and the Business Roundtable Institute for Corporate Ethics jointly called on corporate leaders, asset managers, investors, and others to break the “short-term obsession” harming shareholders’ interests by reforming practices involving earnings guidance, compensation, and communications to investors.
Quarterly Guidance for the Chop 7Days.ae, July 26, 2006
	Moreover, they also want to see increased disclosure of fee structures and incentive targets for investment managers, including mutual fund managers and pension fund managers. Something they are not alone in wanting to see a change in, as the Securities and Exchange Commission is currently in the process of revamping the way companies reveal how they pay corporate executives. Change could come sooner than some think as the new rules might be in place as early as next year.
Kortetermijnobsessie biedt opportuniteiten De Tijd, July 26, 2006
	De institutionele beleggers die de kwartaalfocus uitvonden, keren nu op hun passen terug. Het CFA Institute, dat wereldwijd 83.000 analisten en vermogensbeheerders groepeert, beveelt aan geen kwartaalprognoses meer te geven. Mogelijk is dit in de VS slechts een eerste stap in de terugkeer naar het langetermijndenken. Amerikaanse beursgenoteerde bedrijven moeten, in tegenstelling tot de Europese, kwartaalresultaten publiceren. Misschien slikt de Amerikaanse wetgever over enkele jaren deze verplichting in.
Nu kommer ett upprop från företagsledare på 160 av USA:s största företag och... Svenska Dagbladet, July 26, 2006 By Maria Nilsson
	Bengt Rydén är skeptisk till tvånget på kvartalsrapporter för mindre och medelstora företag. För stora företag som Ericsson ser han dock ingen möjlighet att avskaffa rapporterna eftersom det är så många som är beroende av information om dem, men Bengt Rydén är öppen för att en annan form av information skulle kunna ges kvartalsvis.
Vil stoppe kvartalstyranniet Dagens Næringsliv, July 26, 2006
	«Besattheten rundt kortsiktige resultater får den uønskede effekten at langsiktige verdier ødelegges, det svekker avkastningen og hindrer forsøkene med å styrke styringen av selskapene,» heter det i rapporten fra Business Roundtable Institute for Corporate Ethics, som har 160 toppsjefer i amerikanske storselskaper som medlemmer. Organisasjonen presenterer sin rapport sammen med CFA Institute, som har 80.000 forvaltere og analytikere som medlemmer.
Column: Stop With the Earnings Estimates Associated Press Newswires, July 28, 2006 By Ellen Simon
	As John C. Bogle, founder and former CEO of The Vanguard Group, said "the role of management should not be beating abstract numeric estimates but improving the operations and long-term prospects of organizations." (Also appeared in Aberdeen American News, Cincinnati Post, Albany Times Union, AM New York, Anchorage Daily News, Atlantic City Press, Baltimore Sun, Belleville News-Democrat, Bradenton Herald, Brocktown News, Chicago Tribune, Clute Facts, Ely Times & County, Fort Worth Star-Telegram, Gadsden Times, Galveston County Daily News, Grand Forks Herald, Hendersonville Times News, iWon Money, Jackson News-Tribune, Kansas.com, Las Vegas Sun, Lexington Herald-Leader, Long Island Newsday (newsday.com), Los Angeles Times, McAllen Monitor, My Way Finance, New York Post, NewsFlash, Olberlin Times, Ottawa Recorder, Palm Beach Post, Sacramento Bee, San Jose Mercury News, St. Paul Pioneer Press, Syracuse Post-Standard & Syracuse.com, Tacoma News Tribune (thenewstribune.com), The Courier News (Elgin, IL), The News-Sentinel, The State, The Times Leader, TMCnet.com, Tyler Morning Telegraph, Wilmington Morning Star, WJLA-TV ABC 7 Washington, WJSU-TV ABC 33/40 Anniston, Yahoo! Finance, Yahoo! News) (Also appeared in the following publications on 7/29/2006: Akron Beacon Journal, Gainesville Sun, Honolulu Star-Bulletin, Jackson Clarion-Ledger, Memphis Commercial Appeal, Ocean County Observer, Reno Gazette-Journal, Richmond Times-Dispatch, Saint Paul Pioneer Press, Seattle Post-Intelligencer, The State, Trenton Times, Ventura County Star, Victoria Advocate)
Lifting the Lid: Investors warn against war on guidance Reuters News, July 28, 2006 By Emily Chasan
	Giving up the quarterly guidance game may sound like a good idea, but investors caution it is a dangerous one. Despite calls this week from two influential think tanks for companies to stop giving quarterly earnings forecasts, investors are saying such talk could lead to much less transparency from U.S. companies, as well as more inefficient and volatile markets. (Also appeared in Boston Globe and Boston.com, CNBC.com, Excite News, iWon Money, KPLC-TV NBC 7 Lake Charles, MSN Money Central, My Way Finance New York Times, Spokane Spokesman-Review, WAFF-TV NBC 48 Huntsville, Washington Post, Yahoo! Finance, Yahoo! News)
A Defense Of Short-Termism The New York Times, July 29, 2006 By Joe Nocera
	The most shocking thing I heard this week about the bad effects of short-term thinking came from a 2005 study conducted by three economists for the National Bureau of Economic Research. They asked a series of questions about the importance of quarterly earnings to more than 400 executives and discovered that almost 80 percent of them said they ''would decrease discretionary spending'' in such critical areas as research and development, advertising and maintenance if they needed to do so to make the quarterly numbers. (This article also appeared in the International Herald Tribune on July 29th)
How short-term thinking causes whirlpool effect Sunday Herald, July 30, 2006 By Ken Symon
	A significant report issued last week may just be the start of a move away from the guidance “obsession”. It came from the Business Roundtable Institute for Corporate Ethics (Brice) – an organisation made up of 160 American chief executives – and the CFA Institute. As Dean Krehmeyer, executive director of Brice and one of the authors of the report published last week said: “The obsession with short-term performance does not create value for shareholders and in many cases destroys value.”
Power Outages and the Focus on Short Term The New York Sun, July 31, 2006 By Liz Peek
	What does this have to do with recent recommendations from the CFA and Business Roundtable on deemphasizing quarterly earnings guidance? If indeed it turns out that Con Ed was nearsighted in its investment program, it will be yet another example of a management adhering to inappropriate short-term guidelines. In studying the harmful effects of managing for the near term, the CFA found that 80% of executives surveyed claimed that they would "decrease discretionary spending on such areas as research and development, advertising, maintenance, and hiring in order to meet short-term earnings targets."
Ce qui compte, c'est de bien connaître le secteur Le Temps, July 31, 2006 By Carole Ulmer
	Thomas Rauch, analyste chez Credit Suisse, a lui aussi suivi ce débat de plus en plus polémique sur les prévisions trimestrielles. Son avis est déjà bien tranché. «Je suis tout à fait en faveur de ce mouvement qui cherche à mettre un terme à la pratique des prévisions trimestrielles», assure-t-il d'emblée. Il explique que, selon lui, «cette concentration sur le court terme se fait au détriment du développement à long terme des entreprises». Les chefs d'entreprise sont souvent obligés de revoir leurs priorités pour être sûrs de fournir des résultats trimestriels en accord avec les prévisions qu'ils ont données.
La fronde se constitue contre les prévisions trimestrielles Le Temps, July 31, 2006 By Carole Ulmer
	Au pays de l'Oncle Sam, l'annonce par les entreprises cotées des résultats trimestriels, exigée par la loi, est précédée rituellement de la divulgation d'estimations servant à guider les analystes. Cette vieille tradition est pourtant battue en brèche. Nombre de grands groupes internationaux, parmi lesquels on trouve Google ou Coca-Cola, rejoints récemment par les analystes, montent au créneau pour dénoncer la dictature des prévisions à court terme.
The High Road On Earnings Guidance: Stop It! Newstex Web Blogs, July 27, 2006 By Jack Ciesielski
	An interesting joint effort on the part of odd bedfellows Business Roundtable and the CFA Institute: a document that urges companies to stop issuing earnings guidance. It's a document entitled "Breaking the Short-Term Cycle" (catchy, yet accurate) and you can download it here.
M: Hot Stocks Comtex News Network, Inc., July 25, 2006
	Business groups call for end to quarterly earnings forecasts-Dow Jones - Two influential business groups, the CFA Institute and the Business Roundtable, have released a report pushing for companies to stop issuing quarterly-earnings forecasts in order to end "the nation's obsession with short-term financial results." The report concludes that an emphasis on quarterly earnings creates a system in which companies sacrifice long-term growth for short-term gains.
Offensive contre la dictature des résultats trimestriels aux Etats-Unis LExpansion.com, July 24, 2006
	Alors que Wall Street et la bourse de Paris s'apprêtent à digérer leur flopée traditionnelle de résultats trimestriels estivaux, de très nombreuses voix s'élèvent outre-Atlantique pour tenter d'abolir cette dictature du « court-termisme » magnifiée par la publication des performances détaillées de chaque entreprise cotée tous les trois mois. Cela au motif que cette avalanche trop fréquente de performances comptables nuirait finalement à la gouvernance et aux intérêts à plus long terme des actionnaires.
Investment Adviser: Short-termism -" come in, your time is up. Investment Adviser, July 31, 2006
	The report will probably have been welcomed by shareholders and executives at US banking giant Citigroup, which saw its share price savaged the previous week for having missed its quarterly earnings per share objective by precisely one cent. The report quotes former Securities and Exchange Commission chairman William Donaldson, who called upon bosses to "manage the business for long-term results, and to get away from the attitude that you are managing the business out of a straitjacket that has been put upon you to create earnings per share on a regular basis".
Investors Urged to Scrutinize Contracts: Advisor Contracts Deemed as Critical as Executive Pay Money Management Executive, July 31, 2006 By Hannah Glover
	As regulators wrangle with how individual companies disclose stock options and executive pay, mutual fund experts are now urging shareholders to take a close look at their advisor contracts to see what they are paying the people who run their funds. After all, just as owners of individual stocks may be looking at whether they believe a chief executive deserves discounted stock options and use of a private jet, shareholders should know just where their money is going.

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