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Henry D. Wolfe shared thisThe level of angst and confusion over what is and is not the role of the board in public companies and other non-private equity portfolio companies is sensational. In addition to the above malady, the degree of neutering of boards is also amazing. Example: The CEO reports to the board, not the other way around. But management almost always controls the information flow to the board, i.e. its content, frequency and format. As such a 2024 NACD survey found that only 13% of board members thought their board packs were extremely effective. My question is this: If the information is inadequate then why do boards not do something about it? As noted, the CEO reports to the board, not the other way around. What has happened that has resulted in boards becoming so namby pamby?
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Henry D. Wolfe shared thisPublic Company Boards: Leaving Too Much Value on the Table? 3 Short Case Studies of the Results of Changing Governance Models In my book, I argue that public companies can achieve higher performance and increased value via a “governance arbitrage”, i.e. a change in governance model. This article presents some of the salient points in support of that thesis. #govrnancearbitrage #corporategovernance #boardsofdirectors #valuecreation #fullpotential https://lnkd.in/g5Uc_aSWPublic Company Boards: Leaving Too Much Value on the Table?Public Company Boards: Leaving Too Much Value on the Table?
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Henry D. Wolfe shared thisFrom Shane Parrish’s The Knowledge Project Podcast With Guest Kaz Nejatian, CEO of Opendoor Shane Parrish asked him what allowed him to not care what others think of him. His answer, in part was “And there’s a second thing which is very real. I played Rugby in high school. I am not a big dude but I’m fast and have a high pain tolerance. And I really, really enjoy winning as a team. But Rugby is actually a special sport for this. It tends to be a sport that if you play in North America never has an audience. Like, no one goes to watch Rugby games in North America really. So, you do it for your friends, you do it for your teammates not for the audience. But you get something better out of it which is like this idea of like being in pain while winning as a team. There’s like something very deeply joyful about bleeding out of your knee while winning as a team.” #rugby #leadership
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Henry D. Wolfe reposted thisHenry D. Wolfe reposted thisGemspring is pleased to announce the acquisitions and combination of Key Line Construction and Palouse Power to create a scaled utility infrastructure services platform serving the Pacific Northwest.
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Henry D. Wolfe shared thisMediocrity At Scale A great story and a wake up call for all job seekers. https://lnkd.in/gGqMBb4f
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Henry D. Wolfe shared thisJapan’s New Activists Blend McKinsey And Blackstone It is heartening to see the increased push by the Tokyo Stock Exchange for Japanese public companies to develop more of their potential with heightened focus on capital allocation, return on equity and restructuring of portfolios including cross-shareholdings and underperforming subsidiaries. This will be nothing but positive for the Japanese economy if the ruling political party does not take actions to throttle the process. But the following from the article raises a question. The author advocates for a shift in how activist investors approach their engagement with Japanese companies: "The next stage of Japanese activism, however, should move beyond the traditional activist playbook. "The best activists should approach a company as McKinsey might: developing a rigorous, fact-based assessment of its markets, competitive position, organization and strategic alternatives. They should identify where the company possesses genuine competitive advantages, which divisions can become global leaders and where management should invest to accelerate growth." I agree with this approach and support activist investors. But where are the board of directors at each Japanese company that takes steps to improve capital allocation, operating performance and shareholder value? Just as W. Edwards Deming did with his massive impact on Japanese industry with his quality and statistical programs, would it not make sense now for Japanese businesses that they begin to think in terms of a corporate governance model that, by its design, becomes a solid driver of the development of the full potential of the companies they govern? At this critical inflection point for Japanese publicly traded companies, a new robust, entrepreneurial governance model would lay a foundation that could take these companies to new levels long into the future. #governancearbitrage #corporategovernance #japanbusiness #japangovernance #valuecreation Tokyo Stock Exchange https://lnkd.in/geDE8iQNJapan’s New Activists Blend McKinsey And BlackstoneJapan’s New Activists Blend McKinsey And Blackstone
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Henry D. Wolfe shared this$4.6B CEO: Excellence Is the Capacity to Take Pain Shane Parrish's The Knowledge Project Podcast: In this episode, Shane Parrish talks wtih Kaz Nejatian, who took over as CEO of Opendoor when it was on the verge of bankruptcy. This is one of the best discussions with a CEO I have seen with fascinating insights into developing a company's full potential. The following are a couple of excerpts from the episode: “I think changing defaults is incredibly difficult so if you are going to change a default, you have to do it violently. Let me give you an example: Opendoor was remote. Opendoor was never going to become in-person with a seven step plan over eight months. I know this because Opendoor had many seven step plans over eight months to become in-person and it never worked. The only way for Opendoor to become in-person was through a significant amount of aggression. Transparently, I thought Opendoor was a kind of place where some people were kind of mailing it in. You need to figure out which defaults are killing the company and change them violently. There must not be change management because you want the change to feel jarring. [All Opendoor employees had to go back to the office the Monday following Nejatian's first week or leave the company] #turnaround #leadership #highexpectations https://lnkd.in/gTvASPbt$4.6B CEO: Excellence Is the Capacity to Take Pain | Kaz Nejatian$4.6B CEO: Excellence Is the Capacity to Take Pain | Kaz Nejatian
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Henry D. Wolfe shared thisThe Undervalued & Underperforming Public Company Governance Model Proof of Concept Public company boards act like police and lawyers always working to make sure nothing goes wrong. They are all about risk avoidance rather than enterprise value creation. This view of the board is expensive. Tthe proof of this concept is in this article. #governancearbitrage #corporategovernance #governance #boardsofdirectors #valuecreation https://lnkd.in/gfhyahx6
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Henry D. Wolfe shared thisCEO Pay is Not the Issue — Selection Is Poor CEO Selection Costs Shareholders Billions Annually #corporategovernance #boardsofdirectors #governancearbitrage #valuecreation https://lnkd.in/gkr8PX3f
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Henry D. Wolfe liked thisHenry D. Wolfe liked thisYesterday, Chattanooga showed up. CO.LAB officially signed a new memorandum of understanding with Oak Ridge National Laboratory, creating a stronger pathway to support quantum commercialization, connect emerging technologies with industry, and create new opportunities for founders across Tennessee. We are incredibly thankful for this partnership and for everyone who joined us to celebrate this milestone. A special thank you to Congresman Chuck fleischmann, Senator Bo Watson, Representative Michele Reneau, Representative Yusuf Hakeem, Chattanooga Mayor Tim Kelly, Hamilton County Mayor Weston Wamp, Dr. Shaun Gleason, Janet Rehberg, PMP, CEM, Jermaine Freeman and the many local, state, and regional leaders who continue to believe in Chattanooga’s role in building what comes next. Let’s build what’s next, together. Article: https://lnkd.in/eUDVzxn5
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Henry D. Wolfe liked thisHenry D. Wolfe liked thisDiageo's chair just told the Financial Times, through three people familiar with his thinking, that he is not happy with the board he inherited. He wants directors with real drinks and distribution experience. He is specifically concerned that the current board does not have enough industry knowledge to steer CEO Dave Lewis — or stop him from going too far. Read that last part again. The chair of one of the largest spirits companies in the world is publicly signaling that he needs board members who can push back on his own CEO. This is a remarkable moment in the Diageo story, and it deserves to be understood in full context. Dave Lewis came from outside the industry. He is running a sweeping restructuring that includes closing visitor centers, shutting Distill Ventures, cutting 150 jobs in Ireland, reducing prices on Casamigos tequila, and fundamentally challenging the premiumization strategy that defined Diageo for a decade. The board currently has one non-executive director with senior spirits company experience. John Manzoni's background is energy, government, and civil service. By his own admission, the oversight structure around Lewis's overhaul is thin on category expertise. And honestly, this is the governance question that every major beverage company should be asking right now, not just Diageo. How many boards in this industry have members who genuinely understand route-to-market dynamics, brand equity mechanics, distributor relationships, and consumer behavior in beverages at the operational level? Financial expertise is not a substitute for industry knowledge when the decisions being made are about which brands to cut, which price points to defend, and which markets to exit. The instinct to bring in outside leadership for a turnaround is defensible. The instinct to then surround that leader with people who can actually evaluate whether the turnaround is working is essential. Manzoni understands that. The question is whether he finds the right people fast enough to matter. Boards that cannot meaningfully challenge management on substance are not governance. They are decoration. #BeverageAlcohol #Diageo #Leadership #CorporateGovernance #Spirits #IndustryInsider #TheBarBook
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Henry D. Wolfe reacted on thisHenry D. Wolfe reacted on thisMy private equity firm has raised funds larger than the GDPs of most developed countries. I don't do this for the money these days. I've forgotten more about value creation than most operators ever learn. Stephen A. Schwarzman calls me personally when he needs advice (and I frequently ignore him). At this stage in my life (and after 3 divorces) I do this for pure love of the game. Having led more successful exits than I can legally disclose, I've distilled everything into a system. And I'm democratizing that priceless wisdom for the next generation of PE-backed leaders: (𝟭) ��𝗶𝗴𝗵 𝗜𝗻𝘁𝗲𝗻𝘀𝗶𝘁𝘆 𝗟𝗕𝗢 𝗕𝗼𝗼𝘁𝗰𝗮𝗺𝗽 -- Learn the fundamentals of leveraged buyouts while being waterboarded by a former CIA interrogations expert ($45,000 only 6 slots available) (𝟮) 𝗧𝗵𝗲 𝗢𝗽𝗲𝗿𝗮𝘁𝗼𝗿𝘀 𝗔𝗰𝗮𝗱𝗲𝗺𝘆 -- A PE accelerator on steroids. Literally. 12 weeks with 1500mgs of testosterone. ($60,000) (𝟯) 𝗗𝗿𝘆 𝗣𝗼𝘄𝗱𝗲𝗿 𝗖𝗼𝗳𝗳𝗲𝗲 -- My signature ultra-high caffeine coffee blend. Enough to make Rick James tap out. ($50 + shipping). (𝟰) 𝗔𝗯𝗼𝘃𝗲 𝗧𝗵𝗲 𝗡𝗼𝗶𝘀𝗲: 𝗡𝗮𝘃𝗶𝗴𝗮𝘁𝗶𝗻𝗴 𝗜𝗺𝗺𝗲𝗻𝘀𝗲 𝗪𝗲𝗮𝗹𝘁𝗵, 𝗣𝘂𝗯𝗹𝗶𝗰 𝗖𝗿𝗶𝘁𝗶𝗰𝗶𝘀𝗺, & 𝗢𝗻𝗴𝗼𝗶𝗻𝗴 𝗟𝗶𝘁𝗶𝗴𝗮𝘁𝗶𝗼𝗻 -- My autobiography. Read about it before the Netflix documentary comes out ($350 hardcover +$50 for a signed copy). Don't be a victim in today's market. Comment "PIANO" and my team will send you the link you need to purchase the priceless wisdom above.
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Henry D. Wolfe liked thisHenry D. Wolfe liked thisThe best investors aren't motivated by money. They do it for the love of the game. A lot of investors start because they're drawn to one part of it. It could be money, ambition, fame, or power. But the great investors just do it because they love it. Doesn't get any simpler than that. Investing is a game for them. They figure out industries. Understand businesses. Change strategy when the evidence calls for it. Money is just how they keep score. That's why the best investors don't lose interest when markets get difficult. They still enjoy the process. They still want to understand what's happening. They still get excited when they discover something they hadn't noticed before. Ironically, that's probably one of the biggest reasons they outperform. People who love the game naturally spend more time getting better at it. And that compounds for decades. That's true whether you're playing tennis... Poker... Or investing. Because eventually, the people chasing the outcome get tired. The people who love the game usually don't. ➕ Follow Chris Murphy, CFA for more on investing, decision-making, and long-term thinking. ♻️ Repost if you believe process beats chasing outcomes. 📩 Subscribe to my Substack for deeper dives on institutional investing, business quality, and capital allocation: longrace.com
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Henry D. Wolfe reacted on thisHenry D. Wolfe reacted on thisFiserv’s recent problems are easy to describe as an earnings story. Growth slowed. Margins came under pressure. Expectations were reset. But I think the deeper issue is credibility. When a company misses badly enough, investors stop questioning only the numbers. They start questioning the forecasts, the strategy and the people allocating capital. That is where Fiserv finds itself today. Jana Partners is pushing for a broader portfolio review, and I believe that is the right question to ask. Fiserv may sell assets, refresh the board and publish another long-term plan. But those actions only matter if they produce a clearer company, better capital allocation and a management team investors can trust. Good assets alone do not create a good stock. The structure, incentives and decisions around those assets matter just as much. My latest for Forbes looks at why Fiserv’s real problem may be governance, not payments.Chart by Barchart https://lnkd.in/gU8g9uEdFiserv Stock’s Real Problem May Be Governance, Not PaymentsFiserv Stock’s Real Problem May Be Governance, Not Payments
Experience & Education
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DaVega & Wolfe Industries Holdings
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Publications
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Bed, Bath & Beyond: A Governance Model Clarion Call?
ValueWalk
See publicationExamination of the shortfalls of the Bed, Bath & Beyond board of directors resulting from the public company governance model and its extreme negative impact on BB&B's capital allocation. performance and value.
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The Public Company Governance Model - In Dire Need of Radical Change
The Conference Board
See publicationAnalysis of the shortfalls and underperformance of the current public company governance model with proposal for a new more robust governance model designed for the board to be capable of ensuring optimal capital allocation and maximum company performance and shareholder value.
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Governance Arbitrage: Blowing Up The Public Company Governance Model To Maximize Long-Term Shareholder Value
Milner & Associates
See publicationThis unique book is decidedly not just another tome on corporate governance. Instead, think of it as an investment thesis and memorandum with a radical prescription for optimizing capital allocation and maximizing longer-term company performance and shareholder value at public companies. When a company has assets that are undervalued and/or underperforming, an opportunity exists to create value, in some cases, materially. Public company boards are one such asset.
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We DO Need to Maximize Shareholder Value. Here's Why.
ValueWalk
See publicationArticle that addresses the fallacies of the criticisms of shareholder value maximization and shareholder primacy, correctly defines shareholder value maximization and then makes the case as to why maximizing shareholder value is the the focus needed by the boards of all public companies.
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Focus on Competence, Not Independence to Solve the Problem with Director Selection at Public Companies
Corporate Compliance Insights
See publicationA look at what is missing in director selection criteria, why competence should be the only criterion and what specific competencies are required for the full development of the board as an asset that ensures the optimization of capital allocation and the maximization of company performance and shareholder value rather than an underperforming oversight body.
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The Nonexecutive Chairman: Toward A Shareholder Value Maximization Role
The Handbook of Board Governance/John W. Wiley & Sons
See publicationA compendium of topics edited by Dr. Richard Leblanc. Wolfe contributed Chapter 5 entitled “The Non-Executive Chairman: Toward A Shareholder Value Maximization Role.” This chapter goes beyond the vague idea of the separation of the Chairman and CEO roles into the responsibilities of the Non-Executive Chairman in the context of what should be the board’s primary responsibility: Maximization of capital allocation, company performance and shareholder value. It also explores the qualities, skills…
A compendium of topics edited by Dr. Richard Leblanc. Wolfe contributed Chapter 5 entitled “The Non-Executive Chairman: Toward A Shareholder Value Maximization Role.” This chapter goes beyond the vague idea of the separation of the Chairman and CEO roles into the responsibilities of the Non-Executive Chairman in the context of what should be the board’s primary responsibility: Maximization of capital allocation, company performance and shareholder value. It also explores the qualities, skills and track record required for high performance in this role.
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What You Want In A Non-Executive Chairman
Directors and Boards
See publicationOverview of the qualifications for the non-executive chairman position as viewed through the lens of shareholder value maximization
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The Non-Negotiables of Board Leadership
Boardroom INSIDER
Excerpts from an essay entitled "The Non-Negotiables of Board Leadership" focusing on the non-executive chairman's key role in the maximization of shareholder value
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Board Restructuting: Corporate Governance As The Pathway To Value Creation In Underperforming Companies
Institutional Investor's Journal of Private Equity
A high level overview of the role of the chairman, process for restructuring the board and go-forward steps in troubled and/or underperforming companies.
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5 Ways We Make The NonExec Chair Work
Boardroom INSIDER
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Elwan Dwi Nugroho
Kratom Borneo has long been recognized as one of the most sought-after botanicals in the global kratom industry. Known for its rich alkaloid profile, distinct environmental conditions, and traditional harvesting methods, Borneo-grown kratom continues to dominate international markets. This article explores the origin, quality characteristics, and competitive advantages that make Kratom Borneo stand out among global buyers and enthusiasts. The Origin of Kratom Borneo Borneo, the third-largest island in the world, is divided between Indonesia, Malaysia, and Brunei. The Indonesian region—known as Kalimantan—is where most commercial kratom is cultivated and harvested. The island’s ecosystem, composed of dense rainforests, fertile riverbanks, and equatorial humidity, creates ideal conditions for natural kratom growth. For centuries, indigenous communities in Borneo used kratom leaves for traditional purposes such as enhancing stamina during long workdays, managing discomfort, and supporting relaxation. These uses were passed down through generations, forming a deep cultural connection between the people of Borneo and the Mitragyna speciosa tree. Today, Borneo is considered the heart of kratom production, supplying a significant portion of the world’s kratom through both small family farms and large-scale cooperatives. Environmental Factors Behind Borneo Kratom Quality The unique quality of Kratom Borneo can be attributed to its natural environment. Borneo’s climate features year-round rainfall, moist soil rich in organic nutrients, and consistent sunlight—conditions ideal for high-alkaloid leaves. 1. Superior Soil Composition Kalimantan’s soil contains mineral-dense sediment carried from surrounding mountains and river systems. These nutrients feed the roots of the kratom tree, resulting in leaves with robust alkaloid content. 2. Biodiverse Rainforest Ecosystem The rainforest’s ecological diversity plays a role in protecting kratom trees from pests and environmental stress. This gives kratom leaves a higher chance to mature naturally, which is crucial for maximum alkaloid potency. 3. High Humidity and Stable Temperatures Borneo maintains temperatures between 25–32°C (77–90°F) with humidity levels above 80%. These conditions influence leaf maturity and chemical composition, producing consistent, high-quality kratom harvests. read more : https://lnkd.in/gn8BEWEB #kratomborneo #borneo #praha
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