Weekly Newsletter – April 7, 2014

Happy Monday!
Two big topics last week – the first was kicked off by this article: 60% of Compliance Officers are Women and That’s a Bad Thing started the conversation that with the majority of CCO and General Counsel positions being held by women it is a great opportunity to rebuild corporate ethics and the public trust that was lost during the 2007-2008 revolving door of scandals. The issue is that among publicly traded companies, only 33% of CCOs reported directly to the CEO, so while on the surface this looks like progress it is really pushing what ought to be an important role off to the sidelines, and will prevent that rebuilding from happening.
Case in point – while we are on the subject of a breakdown in ethics, for those of you that missed the launch of Michael Lewis’ new book Flash Boys last week, this is a must read. A review can be found here: http://money.cnn.com/2014/03/30/investing/michael-lewis-flash-boys/
I read the entire book on a flight to California last week. I have to say it is another black eye for the industry. Notably there have been some folks out there saying that the situation is not as bad as it is made out in the book, but if that is true, why are some folks willing to pay millions a year for a faster “pipe” from Chicago to New Jersey at a time when pricing for communication services are coming down? The most telling statistic that illustrates how non-finance professionals feel about the business is that with the markets heading straight up since 2008, less than 50% of retail investors have returned to the markets because they see them as a rigged game, and this does not bode well for our industry. Our industry is one based on public trust. The majority of people I have met over my 25 year career are honest, hard-working people who are dedicated to doing a good job for their clients. It is very disheartening that the industry does not do a better job at regulating its own behavior.
We have just some amazing events coming up over the next few months. Speaking of supporting girls – please take a moment to buy your ticket to our May Panel event in Dallas. We have a fabulous panel of allocators from some of the biggest pensions in the country and you will not want to miss what they have to say about the markets. The event supports the college dreams of under-served girls across the state, and it is a chance to meet your fellow TXWSW members from across the state!
See you all soon.
Kind regards

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