Comments on: Fiddling While Rome Burns http://www.ii2llc.com/index.php/2009/02/25/fiddling-while-rome-burns/ Corporate Governance Engagements for the Long-Term Investor Fri, 27 Jul 2012 18:04:20 +0000 hourly 1 http://wordpress.org/?v=3.4.1 By: Sarah Wilson http://www.ii2llc.com/index.php/2009/02/25/fiddling-while-rome-burns/comment-page-1/#comment-269 Sarah Wilson Sat, 28 Feb 2009 14:42:24 +0000 http://www.ii2llc.com/index.php/2009/02/25/fiddling-while-rome-burns/#comment-269 Andrew you highlight very clearly the problem with 'The Market'. There is no market for corporate governance in traditional investment; the culture of investment does not have governance embedded in its DNA. Why are we not seeing layoffs on dealing desks to ensure that the governance teams can strengthen their work? It is after all the culture of buy and sell rather than buy and hold and buy some more which has encouraged some of the most perverse behaviours. Risk management cannot and must not, IMHO, just come out of a software model. It needs a multi-disciplinary, hands on approach drawing on all the skills and talents of knowledgeable, fully informed and responsible individuals. Black Box models got us where we are today. We must also move away from the notion that centralised rules and regulations are a substitute for informed oversight and basic business honesty. Corporate governance, corporate responsibility are, investment consultants please note, not an investment style but a core philosophy. We have paid a very high price for the attitude of governance being someone else's problem. Andrew you highlight very clearly the problem with ‘The Market’. There is no market for corporate governance in traditional investment; the culture of investment does not have governance embedded in its DNA. Why are we not seeing layoffs on dealing desks to ensure that the governance teams can strengthen their work? It is after all the culture of buy and sell rather than buy and hold and buy some more which has encouraged some of the most perverse behaviours.

Risk management cannot and must not, IMHO, just come out of a software model. It needs a multi-disciplinary, hands on approach drawing on all the skills and talents of knowledgeable, fully informed and responsible individuals. Black Box models got us where we are today.

We must also move away from the notion that centralised rules and regulations are a substitute for informed oversight and basic business honesty.

Corporate governance, corporate responsibility are, investment consultants please note, not an investment style but a core philosophy. We have paid a very high price for the attitude of governance being someone else’s problem.

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