Should NASDEQ require diversity on boards of directors?

Arthur Levitt, former chairman of the SEC, says the SEC should investigate to determine what benefit, if any exists (WSJ, Jan. 2020). Here is a money quote.

"The most powerful argument for board diversity is that diversity is a social good. The most powerful argument against a board diversity requirement is that if it were manifestly good for companies, there would be no need for it in the first place. Successful companies can’t keep secrets quiet for long; if one could reliably increase its market capitalization by, say, 5% through the appointment of a diverse board, every company on Nasdaq would already meet that standard.

"The problem of board diversity is compounded by the nomination process. Searches for directors are formally structured, but in the end they depend on informal social networks where friends recommend each other. In my experience, many such searches are closer to a social-club recruitment process than a serious contemplation of someone’s task-specific skills. And as has been shown by the National Football League’s Rooney Rule, which since 2003 has required that teams interview at least one ethnic-minority candidate for all head-coaching positions, formal requirements for effort don’t necessarily lead to results.

"Since neither Nasdaq nor the SEC can reliably say that more diverse boards produce better results than homogeneous ones, the SEC should lead."

Trends in which activities beauty firms perform internally

"Historically, big beauty companies have been in charge of their own manufacturing, formulations and distribution, while relying on advertising agencies to market their products and retailers to sell them. But a generation of beauty startups, including Kylie Cosmetics, is upending that formula, selling directly to consumers and relying on social media for marketing, while farming out production and distribution to third parties."

Kylie Cosmetics generates  "$200 million in annual revenue with fewer than a dozen employees and virtually no ad spending."

WSJ, Jan. 2021.

HBR on Strategy

 Casadesus-Masanell, Ramon. 2014. Introduction to Strategy. HBR

Casadesus-Masanell, Ramon. 2014. Industry Analysis. HBR

ebiz

Marchand, Donald A., and Joe Peppard. 2013. Why IT Fumbles Analytics. HBR
Focus on information rather than technology.

Carr, Nicholas G. 2003. IT Doesn't Matter. HBR
IT is a commodity -> spend less, follow rather than lead, and focus on risks rather than opportunities.

Davenport, Thomas H. 2006. Competing on Analystics. HBR
Become an analytics competitor to differentiate yourself.

McAfee, Andrew, and Erik Brynjolfsson. 2008. Investing in the IT that Makes a Competitive Difference. HBR
IT -> more concentration and more turbulent. To thrive firms need to deploy, innovate, and propagate.

Bargaining Power in the Streaming Industry

Does Roku need WarnerMedia more than WarnerMedia needs Roku (WSJ, Dec. 2020). Also, who is buying and who is selling? "Roku initially paid media companies to license content for the channel. But lately, Roku has demanded programming from media companies as a toll for carrying their apps, people familiar with Roku negotiations said. If media companies provide enough compensation to Roku in other ways, such as ad or subscription money, the company relaxes its demands for Roku Channel programming."

Bargaining Power of Suppliers

"Peter Jackson’s Special-Effects Firm Looks to Become a Content Producer" is an example of forward integration (WSJ, Dec. 2020).

Are you willing to accept a lower interest rate to lend to green projects?

Borrowers get slightly lower interest rates when they sell "so-called green bonds" (WSJ, Dec. 2020). The difference, called the greemium, means that lenders receive a lower interest rate. I am confident that corporations will be more socially responsible when being responsible results in lower costs and higher prices.