If the corporate governance movement wanted an easy target in the technology world you would think they would take aim at the HP board whose board chair used corporate resources to spy on her fellow board members a few years ago and which then mishandled its recent CEO transition in the process erasing more than $10 billion in shareholder wealth.
But, no, instead, in a repeat of their embarrassing attack a few years ago on capitalist icon Warren Buffet, CalPERS is now targeting, of all companies, Apple!
CalPERS is quarreling with how Apple chooses its board members despite the hundreds of billions in value that board created over the last fourteen years since they re-hired Steve Jobs as CEO. Folks, this is a company with gross margins of 41%! And yet, amazingly, in the face of the most impressive display of capitalist strategy in modern business history, CalPERS “Corporate Governance” head Anne Simpson contends there is “systemic risk” at Apple. So does Ms. Simpson think California’s public sector retirees should invest their hard earned assets somewhere else, China perhaps, or maybe Pakistan where they really know a thing or two about governance?
Oh and did I mention that Steve Jobs was named “Person of the Year” this week by the Financial Times? Or that President Obama recently lauded Steve Jobs, the adopted son of immigrant parents, as the embodiment of the American Dream?
I have always been a big backer of stronger board accountability – to shareholders and to all corporate constituents – but this is just plain dumb. CalPERS is likely damaging much of the progress made by the corporate accountability movement. After all it’s not like there are not problems that could be raised with Apple, particularly their relationship with sweatshop production companies like Foxconn in China, a problem they share generally with the high tech environment that I have targeted here before. Steve Jobs’ cold response to the suicides that have swept through the Foxconn workforce was not his finest hour.
But a corporate governance problem? at Apple? Really?
Oh, and did I mention all the taxes paid into California coffers by any California residents who sold profitable Apple shares over the last decade?