In a recent line of scandals for the ride-hailing giant, Uber is feeling the heat for its use of a secret program, which operated to deceive law enforcement and identify undesirable riders.
If the $31 billion merger of Deutsche Börse and the London Stock Exchange (LSE) collapses, this will be their third failed attempt since 2000. However, if the deal goes through, LSE-Deutsche Börse would be the world’s biggest exchange operator by revenue and second-largest exchange operator by market value.
President Trump Scales Back Dodd-Frank
The Dodd-Frank Wall Street Reform and Consumer Protection Act, better known as the Dodd-Frank Act (the “Act”), is a financial reform package passed during the Obama administration as a response to the financial crisis of 2008. The Act, signed into law in 2010, re-designed Wall Street and the American financial industry. Banks and other financial institutions were forced to undergo a series of new regulatory exams and cut back on their lucrative, but illiquid, private equity and hedge fund investments. The Act created new governmental agencies and strategies to oversee mid-sized banks all the way up to multi-billion-dollar firms. Now, seven years after its enactment, President Donald Trump has pledged to significantly reduce and repeal the Act.
Unilever, a British consumer goods company, is exploring alternative methods for expansion after Kraft Heinz withdrew their $143 billion takeover bid in February. The takeover would have created an industry stalwart and giant within the packaged food and consumer goods realm. The original offer intended to pay shareholders $50 a share in a cash-stock combination.
On February 15, despite efforts from the International Association of Machinists and Aerospace Workers (IAM), seventy-four percent of approximately 3,000 eligible employees voted to reject unionization of Boeing’s Dreamliner assembly line in North Charleston, South Carolina.
Amidst a steady increase in subprime auto loans, lenders are utilizing new surveillance technologies to mitigate their risk. Finance companies, credit unions, and auto dealers use GPS tracking to monitor borrower’s locations and “kill switches” to remotely disable vehicles. Lenders say these devices allow them to extend loans to more Americans with poor credit as they can locate the vehicle if a borrower defaults on payments and repossession is necessary.
In early February, about 130 tech companies including Apple, Facebook, Google and Microsoft, filed an amicus brief in opposition to President Trump’s immigration ban. The ban represents “a significant departure from the principles of fairness and predictability that have governed the immigration system of the United States for more than fifty years” states the amicus brief, written by Andrew Pincus of Mayer Brown LLP. In practice, President Trump’s executive order makes it difficult for U.S. companies to recruit, hire and retain some of their most talented employees, as well as threatens their ability to attract investments. Though most large tech companies signed the brief, two big players IBM and Oracle, among others, refused to do so.
IBM’s chief executive Virginia Rometty not only refused to sign the brief but also sent an open letter to President Trump expressing support in her capacity as the company’s CEO. Rometty offered specific ideas she believes “will help achieve the aspiration [Trump] articulated and that can advance a national agenda in a time of profound change.” IBM’s current and former employees, accompanied by the “IBMers” community, repudiated Rometty’s support for Trump and refusal to sign the amicus brief. In response, they signed a petition asserting that IBM’s core values of diversity, inclusiveness and ethical business conduct are against Trump’s ban. In addition, IBM employees are publicly refusing to participate in any U.S. government contracts which violate constitutionally protected civil liberties.
Oracle is facing a similar situation. In December, co-chief executive Safra Catz declared that the company is “with [Trump] and will help in any way [it] can.” Like IBM, Oracle refused to sign the amicus brief. In response, three young women employees started a petition asking the company to change its mind. As of today, Oracle has declined to comment on this employee-led push.
In general, however, the tech industry stands with the values echoed by the Never Again pledge. In signing the pledge, almost 3,000 tech workers have agreed not to participate in the creation of any government order to build or share any database that will be used to target people based on race, religion or national origin. The pledge recognizes tech companies’ prior complicity in human rights violations. For example, the pledge cites IBM’s collaboration in 1939 with Nazis to digitize and streamline the Holocaust, resulting in the deaths of millions.
Nowadays, when you enter any company’s webpage and read its core values you will see words such as diversity, respect and inclusivity. Whether these companies really believe in those values or are merely adopting them to adhere to trends is up for debate. Now that President Trump and his ban have condoned racism, executives such as Rometty and Catz are willing to lend their powerful technology to help the government find targeted people. The huge concern here is whether IBM and Oracle will help repeat history and contribute to millions of deportations, families’ separation, and in the worst-case scenario, death. This is the time for executives to recall the values that they presumably stand for and begin abiding by them. Companies must protect their employees and their clients against any kind of racism, and respect the constitutionally protected civil liberties that have defined the U.S. for years.
Toshiba, the Japanese technology conglomerate, has spent the better part of a decade and billions of dollars situating itself as one of the most prominent players in the global nuclear power industry by buying up rivals. Although Toshiba’s growth has been impressive, it has resulted in a financial disaster that appears to be growing worse.
In December 2016, Toshiba warned that it would need to write off “several billion U.S. dollars” because of its purchase of American construction firm CB&I Stone & Webster, a firm that specializes in projects involving nuclear power. This potential write-off triggered alarm in the financial industry given that Toshiba’s nuclear subsidiary in the United States, Westinghouse, bought the business for $229 million. Westinghouse’s 2015 purchase of CB&I Stone & Webster was geared towards winning more business in the spheres of decontamination, decommissioning, and plant projects. Following the warning announcement, Toshiba’s share price dropped 12%.
On February 14, Toshiba announced that it planned to write off more than $6 billion and withdraw from the business of building nuclear power plants as the impact of its disastrous bet on the American nuclear industry started to rock Japan’s corporate landscape. Following this announcement, Toshiba’s Chairman, Shigenori Shiga confirmed that he would resign, putting an end to weeks of speculation about the chairman’s future.
Toshiba has announced that it is set to report a net loss of 390bn yen, or $3.4 billion, heading into March 2017. This volatile situation has caused analysts to predict that the company’s future may be at risk. In a last-ditch attempt to preserve the value of the company, Toshiba has already announced their plans to sell off a portion of its successful memory chip department in order to raise funds.
Prior to the current scandal, Toshiba had been struggling to recover after news broke in 2015 that the company had overstated profits for seven years, a revelation that prompted the former chief executive to resign.
The company said that it will reorganize its nuclear business under Toshiba’s President, Satoshi Tsunakawa, in order to ensure stricter monitoring. Tsukanawa has said that the company is currently looking for potential partners to acquire a stake in Westinghouse. He bowed to the crowd at the news conference to apologize for “troubling investors and stakeholders.”