The Week 07Feb2020

Reviving “the corporate-

music tradition of old

industry giants like

Boeing and Kodak,” tech

firms such as Google

and Amazon are spon-

soring formal symphony

orchestras, said Chip

Cutter in The Wall Street

Journal. Amazon’s

nearly 100-employee

orchestra includes “for-

mer high-school band

geeks or music majors”;

it found oboists via “a

group on Amazon’s

internal directory called

#OboeYouDidnt.”

In numbers-driven

Amazon style, after

each performance “the

Amazon orchestra

sends its musicians a

survey asking them

to rate the difficulty of

each piece played and

their level of prepared-

ness.” An invite to hear

Google’s symphony has

become “a hot ticket.”

Meanwhile, older

orchestras have sur-

vived as the companies

around them changed.

The Hewlett-Packard

Symphony Orchestra

“split from the company

in 2008” and changed

its name to “The Group

Formerly Known as the

HP Symphony.”

Concerto in

Google minor

BUSINESS

Goldman Sachs surprised Wall

Street last week by “doing

something virtuous,” said Dan

Primack in Axios.com. The invest-

ment bank said it will not take

European and North American

companies public unless they

have at least one “diverse” board

director— meaning “anyone who

isn’t a straight, white male.”

Board diversity has been high

on the corporate agenda for a while: California

already requires public companies based in the

state to have at least one woman director. The

bank took heat last year for its flop with WeWork,

which had an all-male board until shortly before its

failed IPO, and this move might “cause rivals like

Morgan Stanley and JPMorgan to raise the ante.”

Goldman CEO David Solomon

is happy to tout his “woke-

ness” as long as it doesn’t hurt

business, said The Wall Street

Journal in an editorial. In prac-

tice, this changes little: “Many

European countries, including

Germany, France, and Italy,

have already imposed gender

quotas for their corporate direc-

tors,” and every company in the

S&P 500 has at least one woman on its board.

Homogenous boards are much more common

in Asia, the Middle East, and South America—

precisely where Goldman has been chasing busi-

ness “as it becomes harder to deliver growth

in the U.S.” Conveniently, Goldman’s diversity

pledge doesn’t apply in those areas.

Banking: Goldman’s diversity mandate

Apple: Wearables and phones drive record quarter

Apple blew away investors’ expectations in the first quarterly report

of 2020 with “stellar” numbers and growing iPhone sales, said Steve

Kovach in CNBC.com. Revenue surged to $91.8 billion, and profits to

$22.2 billion, both company records. For the first time, Apple’s acces-

sories category, which includes the Apple Watch, AirPods, and gadgets

such as the HomePod speaker, surpassed its Mac computer business.

Sales of wearables—about $20 billion last year—are so strong that

Apple can’t keep up; CEO Tim Cook said Apple could not “make

enough Series 3 watches or AirPods Pro to meet demand.”

Trade: USMCA signed to replace NAFTA

President Trump signed the United States–Mexico-Canada Agreement

this week, said Michael Collins in USA Today, replacing the North

American Free Trade Agreement and sealing “one of his top legislative

priorities.” The revamped deal, which still awaits Canada’s ratification,

“guarantees U.S. farmers greater access to Canada’s agriculture market

and puts new e-commerce rules in place.” It also adds labor protections

for workers in Mexico and creates new incentives for carmakers to build

autos in North America. All three countries now embark on a “pains-

taking” process of crafting regulations to meet the terms of the deal.

Scandals: Former Wells Fargo CEO banned

Wells Fargo’s former CEO was fined $17.5 million and agreed to a life-

time ban from the banking industry for his role in a 2016 sales scandal,

said Stacy Cowley and Emily Flitter in The New York Times, “a rare

instance of personal consequences for those at the highest echelons of

the banking industry.” “In a damning” legal filing last week, regulators

blamed ex–chief executive John Stumpf for placing “relentless pressure,”

including “hazing-like abuse,” on employees to meet the bank’s unrealis-

tic goals. Many workers felt they had two options: “Cheat or get fired.”

Apparel: Victoria’s Secret chief in talks to step down

Les Wexner, CEO of the company behind Victoria’s Secret, and the

longest-serving chief of an S&P 500 company, is in discussions to step

aside after 57 years at the helm of L Brands, said Khadeeja Safdar and

Corrie Driebusch in The Wall Street Journal this week. One of the most

influential figures in retail, Wexner “built Abercrombie & Fitch, The

Limited, and Victoria’s Secret into national chains.” But the 82-year-old

now faces falling sales at Victoria’s Secret and accusations that he let dis-

graced financier Jeffrey Epstein take a role in the business, even getting

his “input on which women should be Victoria’s Secret models.”

36

The news at a glance

Re

ute

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(^2 )

Solomon: ‘Woke’ CEO

QGoogle received more than

75,000 requests for data from

law enforcement on nearly

165,000 accounts worldwide,

with one in three coming

from the U.S. With so many

requests, the company has

begun charging fees: $45

for a subpoena, $60 for a

wiretap, and $245 for a search

warrant.

The New York Times

QAmericans are projected to

inherit $764 billion this year

and will pay an average tax

of just 2.1 percent on that

income. For married couples,

the first $23.2 million of an

estate is tax-exempt, and the

rich can funnel more to heirs

tax-free using trusts and other

complicated strategies.

Bloomberg.com

QThe average

ticket price

for this year’s

Super Bowl

is $7,000, with

the cheapest upper

deck seats going for $4,750

on the NFL Ticket Exchange.

Hotel rooms at a four-star

location in the Miami area

average $880 per night.

CNBC.com

QSixty health-care companies

and trade organizations col-

lectively spent $309 million on

federal lobbying in 2019, up

9 percent from the previous

year. That includes $120 mil-

lion from the phar ma ceu ti cals

trade group, PhRMA, to pay

for 450 lobbyists.

Axios.com

QDirect-to-consumer mat-

tress startup Casper set a

top range for its planned IPO

at $768 million. That’s more

than a 30 percent cut from

the $1.1 billion value private

investors put on the money-

losing startup last year.

New York Post

QBoeing reported a loss of

$636 million for 2019, its first

annual loss in more than two

decades. The company put

the total costs of its 737 Max

crisis at $18.6 billion, more

than double its previous esti-

mate. That includes $8.3 bil-

lion in payments to airlines

for undelivered jets.

Financial Times

The bottom line