Stories from South Africa

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Stories from South Africa

• Amanda Vermeulen
• Global Corporate Governance Forum Media
  Workshop
• May 2006

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Sharing my experiences

• to help you produce fair and accurate corporate
  governance stories
• while avoiding prosecution!
•  

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Posted to the web on 28 September 2005Mining
magnate Brett Kebble shot dead in Johannesburg 
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Why should you investigate corporate governance
issues?

• Corporate governance ensures that the fabric of
  the business environment does not unravel
• A country can put as many rules and regulations
  in place as it wants but the media are the eyes
  and ears of the consumers, shareholders and
  regulators
• Poor governance in business leads to corrupt
  practices in other spheres of society

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"The proper governance of companies will become
as crucial to the world economy as the proper
governing of countries." James Wolfensohn,
Former President of the World Bank
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Why should you investigate corporate governance
issues?

• If you choose to produce these kinds of stories,
  you should be motivated to perform some kind of
  social service
• Its good for your business radio, TV or print
  bad news sells if it bleeds it leads!
• Recognition for these stories is good for your
  career
• They are the fun stories to produce, and are
  mentally stimulating

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When do you investigate corporate governance
issues?

• If something looks too good to be true, it
  generally is for example, Enron
• When a company doesnt pass the simple question
  test e.g., the tech stocks disaster of late
  1990s
• When your sources all start telling you the same
  thing
• Inconsistent financial performance
• A rush of unexplained resignations from the board
  of directors and/or senior management

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When do you investigate corporate governance
issues?

• 6. When several members of senior staff exercise
  share options
• Suspicious trading in shares around a major
  announcement
• Unexpected change of auditor or other
  professional advisers
• When the company starts using the chief media
  spokesman all the time plausible deniability
  (White House technique)
• Unusual merger and/or acquisition activity
• Related party transactions

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How do you investigate corporate governance
stories?

• As this is about ethics, it is even more
  important to be seen to be acting ethically
• Do your research there are no short cuts
• Speak to as many people as possible but never
  give away your story be as vague as you can
  dont show your hand and tip off your subject
• Cover all your bases when following the chain of
  evidence
• Build a body of evidence and dont rely on a
  single fact
• Keep accurate records of everything dates,
  times, venues, names

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Hastiness and superficiality are the psychic
diseases of the twentieth century, and more than
anywhere else this disease is reflected in the
press. Alexander Solzhenitsyn 
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How do you investigate corporate governance
stories?

• Question the motives of your sources almost
  no-one will leak information because of their
  moral conscience
• Verify your information from more than one source
• If you reach a dead end, take a lateral approach
  you need to learn to look at the story from a
  multitude of perspectives
• At all times show the subjects of your stories
  courtesy and fairness, whatever your personal
  feelings

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How do you investigate corporate governance
stories?

• Never be seen by industry or your peer group to
  be biased in your reporting or it will undermine
  the credibility of your articles
• Check the accuracy of figures and quotes with
  your sources
• Err on the side of caution when dealing with
  corporate abuse your adversaries are experienced
  and extremely clever people who are not easily
  caught out. Wait until you have irrefutable
  evidence rather than a lot of allegations
• At no time compromise your sources

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How I did itTigons tiger caught by his tail

• Tapes
• Research
• Numerous interviews
• Didnt rely on a single allegation
• Verified chain of evidence
• Questioned sources motives
• Checked for compliance with spirit and law

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Wooing the press is an exercise roughly akin to
picnicking with a tiger. You might enjoy the
meal, but the tiger always eats last. Maureen
Dowd
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How not to do itfrom personal experience

• 1.No matter how long youve known them and how
  well you trust your sources, never take their
  word as the only evidence
• 2.Make sure you know the law or the subject of
  your investigation will throw the book at you
  

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How not to do itfrom personal experience

• 3.Dont let your personal feelings get in the way
  of professional judgement or instinct
• 4.Never be sloppy about your fact checking
• 5.Never give the subject of your stories rope to
  hang you give them right to reply, although it
  contradicts your story

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AND
When it stops being fun, do something else!