|
|
ONLINE FEATURES
Book Reviews
BW Video
Columnists
Interactive Gallery
Newsletters
Past Covers
Philanthropy
Podcasts
Special Reports
BLOGS
Auto Beat
Bangalore Tigers
Blogspotting
Brand New Day
Byte of the Apple
Economics Unbound
Eye on Asia
Fine On Media
Green Biz
Hot Property
Investing Insights
Management IQ
NEXT: Innovation
NussbaumOnDesign
Tech Beat
Working Parents
TECHNOLOGY
J.D. Power Ratings
Product Reviews
Tech Stats
Wildstrom: Tech Maven
AUTOS
Home Page
Auto Reviews
Classic Cars
Car Care & Safety
Hybrids
INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | |
FEBRUARY 9, 2004
Edited by Ira Sager Talk Show "His Microsoft Empire is actually bigger than her British Empire." -- Jay Leno, on Queen Elizabeth II knighting Bill Gates as a Commander of the British Empire Spitzer's Surprising Donor List New York Attorney General Eliot Spitzer's crusade to clean up Wall Street has helped raise his profile in advance of a possible run for governor. According to recent New York state election filings, his campaign organization, Spitzer 2006, has almost $3.6 million. That's more than double his likely rival, current Governor George Pataki. But an examination by BusinessWeek found that a number of donations are from law firms representing clients caught up in Spitzer's probe of the mutual-fund industry. On Nov. 25, campaign records show Spitzer received $1,000 from defense lawyer Gerald Shargel. That was the same day Shargel's client, William Kenyon, ex-president of Security Trust, was arraigned for grand larceny and fraud. Kenyon allegedly acted as a middleman to facilitate market timing for hedge fund Canary Capital Partners. Shargel has been a longtime Spitzer donor, but admits: "On the same day that I'm having heated discussions with his office, they're [Spitzer's fundraisers] calling, saying, 'Where's my check?"' New York law firm Kramer, Levin, Naftalis, and Frankel, which represented Canary Capital head Edward Stern, has given a total of $12,000 to Spitzer. Campaign filings show that $2,000 was contributed before the Canary case arose, and $10,000 more was given in November -- after Stern reached a $40 million settlement with the AG. Kramer Levin and Spitzer declined comment. New York state election law does not preclude such giving, and legal experts say donations from law firms to politicians are commonplace. Cynthia Darrison, managing director of Spitzer 2006, says it does not accept money from anyone with a "matter presently pending" with the AG's office. But she says that doesn't apply to lawyers: "Every law firm does work with the Attorney General's office." If Spitzer wants to keep his rep as a crusader, he may want to rethink that policy. By Brian Hindo   Punchy New Ads From Adidas Tired of being the perennial also-ran to Nike (NKE ), Adidas-Salomon (ADDDY ) plans to pump more than $50 million into an ambitious new ad campaign. On Feb. 5, Adidas will kick off a series of TV, print, and Internet ads featuring Muhammad Ali and his daughter, boxer Laila Ali, BusinessWeek has learned. Adidas even has a new, Nike-like theme: "Impossible is Nothing." Some ads will include star Adidas athletes with Ali or in their own spots. Others will highlight nontraditional sports such as skateboarding and athletes overcoming physical handicaps. "The challenge for Adidas is daunting," says Jeffrey Bliss, president of sports marketers Javelin Group. "They have to overcome their own previous marketing missteps and then take on Nike, which is showing no sign of stumbling." The ads are part of Adidas' efforts to reenergize its business in North America. It wants to nearly double its U.S. market share, to 20%. Despite strong sales of its new Tracy McGrady basketball sneaker, total North American sales have dropped 16% in the first nine months of 2003. With Nike controlling 41% of the U.S. footwear market, Adidas execs will need to believe their own advertising. By Stanley Holmes Hedge Funds: Thorny For Small Fry Want to find out which hedge funds accept money from small-fry investors? The Securities & Exchange Commission seems a good place to start, since funds must register with the agency before they can take money from anyone earning less than $200,000 a year and worth under $1 million. Good luck. Although the SEC wants more disclosure from hedge funds, the agency is not releasing data or tracking it in a way that might help investors in this murky world. Most hedge funds don't register, preferring to work with only a few high rollers. But more advisers are registering under the 1940 Investment Company Act so they can pool investors' money and put it into hedge funds. That bypasses the salary minimum, but triggers SEC reporting requirements. Trouble is, the SEC's data is sketchy. When funds register they may not identify themselves as hedge funds or as funds that invest in them, so SEC gumshoes guess. The list "is developed for staff use. We don't have confidence in it," says SEC spokesman John Nester. The SEC worries that if it distributes the list, it could appear to be endorsing firms. Still, a list would tell investors which funds are open to them and which have an extra set of eyes on them. By Faith Arner Pay Day When a resident of South Euclid, Ohio, won the Mega Millions lottery on Jan. 6, the budget-strapped city of 23,000 thought it had hit the jackpot, too. The town, which has a 1.5% income tax, believed it was entitled to $1.4 mil-lion of the $94 million lump-sum payment. But the joy was fleeting because of the fine print -- or lack thereof. Turns out the town had failed to amend its tax code so that lottery winnings could be considered income. On Jan. 26, the city council voted to fix the oversight. It had reason to hurry: Three unclaimed lottery tickets totaling $375,000 have been sold in town. But if those ticketholders aren't residents, the city will be out of luck -- again. By Robert Berner Continental Shift In CEO Salaries After years of lagging behind the U.S., European CEOs have closed the compensation gap in one area: cash. At companieswith sales of at least $35 billion, U.S. and European chiefs earn salaries and bonuses of $2.4 million on average, says a Hay Group study. For those keeping score, U.S. CEOs still receive more than twice as much in stock and options. That's partly because European companies tend to spread stock and option wealth evenly among top execs. In the U.S., the imperial CEO still takes the lion's share. By Louis Lavelle Bill Gates: Corbis Is Getting The Picture  Ever wonder what happened to the other company Bill Gates started -- the one that's not worth $300 billion? Well, Corbis is doing well, thank you. The Seattle archive of 70 million photos and artwork images saw its revenue jump 20% last year, to $140 million, and it expects to make a profit by yearend. Corbis is second only to Getty Images (GYI
) in the $1.5 billion market.It's lucky that Gates is a patient investor. He started Corbis in 1989 with the original dream of supplying images that people could show on electronic screens at home, as he does at his own $50 million manse. While that piece of the business is still small, Gates is doing his part to boost it. He changes the images on the 30 screens in his home weekly, most recently to show wedding photos for his 10th anniversary. He's also keen on World War II images and works by American artists. "Corbis is a business that's doing neat things, and it's fun for me," says Gates. It may be even more fun when it's profitable. By Steve Hamm Got Worries? Tell Them To The Chaplain While President Bush wants to use government money for faith-based initiatives, many CEOs are spending company money on one of their own: the corporate chaplain. To provide emotional support and guidance to workers wrestling with personal problems, employers such as poultry giant Tyson Foods (TSN ) are hiring part-time chaplains. "We're not equipped to help cope with those kinds of problems," says David Congdon, president of Old Dominion Freight Line (ODFL ), a Thomasville (N.C.) trucking company that has a chaplain. Most companies already have employee assistance programs, which initially involve telephone counseling. Since corporate chaplains are often onsite, it can be easier for employees to build relationships with them and seek help in times of need. The demand has given rise to rent-a-chaplain firms such as Marketplace Ministries and Corporate Chaplains of America. They charge from $250 to $100,000 a month, depending on the number of workers. "The industry is growing dramatically," says Mark Cress, president of Raleigh (N.C.) Corporate Chaplains. This year, he expects to double his workforce to 100 chaplains. Marketplace Ministries boasts 244 clients -- 30% more than in 2002 -- including Pilgrim's Pride (PPC ), another poultry producer that spent $1 million on chaplains last year. Most of the growth is in the South, followed by the Northeast. Critics caution that these chaplains, unlike traditional counselors, are not as bound by confidentiality laws. Cress says that if his chaplains learn of a potential problem -- say, a worker confesses to a drug habit that might create a safety issue -- it will be reported to the company. One higher power these chaplains answer to may be the CEO. By Michael Eidam A Wide-Open Wireless Frontier For a telecom industry that's hungry for growth, sub-Saharan Africa is emerging as a surprising oppor-tunity. With 650 million people, it's now the fastest-growing market for mobile-phone service. Last year, mobile subscribers shot up 37%, to 34.4 million, vs. a 32% rise in Eastern Europe, the No. 2 growth area, says researcher Gartner. Sellers of wireless networks including Ericsson (ERICY ), Alcatel (ALA ), and Motorola (MOT ) are starting to take notice. "[They] are looking for their next billion customers, and a lot of those could come from Africa," says Yankee Group (RTRSY ) analyst Matt Hatton. The World Bank estimates that sub-Saharan Africa will spend $3.2 billion annually over the next five years on wireless infrastructure. That could help narrow the Digital Divide. By Andy Reinhardt 
| | |
 Copyright 2004, by The McGraw-Hill Companies Inc. All rights reserved.Terms of Use | Privacy Notice |
Printer-Friendly Version
