U.S. CEOs Want Fewer Barriers in Trade with China
American business leaders went to Washington, D.C. this week to stress to the political leaders of China and the United States that they want more business deals with China. Everyone at the meeting knew that Americans don’t agree with China on currency issues, trade regulations or even human rights policies, but President Barack Obama reinforced the word from U.S. CEOs.
"We want to sell you planes, we want to sell you cars, we want to sell you software," Obama said.
So far, the two countries are involved in $45 billion worth of business. Business leaders pointed out there are “barriers” to further investment that both the Chinese and the United States governments need to address, according to some of the 14 U.S. CEOs present at the meeting, says a report from The Wall Street Journal.
Obama said U.S. business should get a "fair, level playing field" in China. Removing trade barriers and protecting intellectual property rights are important for U.S. companies interested in China trade. Obama also highlighted that increased trade with China leads to increased jobs for Americans.
Hu promised U.S. businesses will be given "equal treatment."
The CEOs appeared content but realistic after the meeting.
"China moves at its own pace," Motorola Solutions CEO Greg Brown told The Journal after the meeting. "The relationship continues to evolve. I do think China is committed to making a level playing field."
"We voiced the concerns that we had," added Aris Candris, CEO of Westinghouse Electric, in his comments to The Journal. "We also talked about the opportunities that exist in the markets both ways, both in China and the U.S., and what was said in the meeting was that all of these items are being worked on."
For more about the meeting between CEOs and the U.S. and Chinese political leaders, as reported by The Wall Street Journal, please click here.
Apple May Be Forced to Release More Details on CEO Succession
Like many companies, Apple would prefer not to make too much known about its succession plans in case the company needs a new CEO. But a major shareholder is pressing Apple to reveal details about how the company plans to choose Steve Jobs' successor.
The Central Laborers Pension Fund plans to advocate for Proposal No. 5 at Apple’s annual meeting. It would require Apple's board to list “criteria for choosing the next CEO and name internal candidates for the job (possibly including interim boss Tim Cook). It also demands that Apple begin a ‘non-emergency CEO succession planning’ process and report on it to shareholders each year,” according to a report from Fortune magazine.
Apple wants shareholders to oppose the union’s proposal, for among other reasons, releasing the information may lead its competitors to hire away executives who are not on the short list for the post.
Fortune reports that new federal regulations may be on the union’s side. Companies may have to release CEO succession plans to shareholders given the risk it generates.
One consultant told Fortune Apple could have avoided the showdown if the company released “general information” such as selection criteria and its strategy to come up with internal candidates to succeed Jobs.
Another area that Apple could have focused on is listing challenges facing the current CEO and then comparing them with the challenges that will likely be faced by the next one.
Apple did not have to release its short list for the next CEO, however.
Hopefully, Jobs, who has taken a third medical leave for an unspecific amount of time, will be able to soon return to his post. Even though Apple has a strong number of top executives, he is seen as a key leader for the innovative company.
But during this age of greater transparency, it would be wise for Apple and other companies to be more flexible with openness on CEO succession plans. Not everything needs to be released, but an attempt should be made to comply with the new regulations.
For more about Apple’s succession planning, as reported by Fortune, please click here.
Government Panel Proposes that Bank CEOs Promise Regulatory Compliance
A federal government panel is proposing that bank CEOs need to give personal pledges that their businesses are in compliance with new regulations. Bloomberg News says it is not something that the CEOs are wild about. Under the proposal, CEOs must say in public they will follow the Volcker rule, according to the Huffington Post. That rule restricts a bank on making trades for their own accounts, explains Bloomberg News.
The Financial Stability Oversight Council came up with the proposal after the enactment of the Dodd-Frank reforms in 2010.
The law restricts proprietary trading, “which enables taxpayer-backed banks to profit by making trades on their own behalf,” says the Huffington Post. The practice, some argue, led in part to the financial crisis.
Dodd-Frank didn't prohibit the practice. It lets banks invest 3 percent of their capital in hedge funds and private equity funds, according to the Huffington Post.
Much of the concern about the rules relate to definitions used by government regulators. The Huffington Post said that banks say a very narrow definition on “market making and other permitted trades” will lead to restrictions on credit and stand to negatively impact the U.S. economy.
For more about the proposals, as reported by the Huffington Post, please click here.