Corporate Scandals Have a Cost for Investors

Corporate Scandals Have a Cost for Investors

Post of Barrons article quoting Dr. Tiemann

Author Vito J. Racanelli published an article entitled “Corporate Scandals Have a Cost for Investors” in Barrons, in which he discussed the phenomena of Corporate America’s multitude of “ethical and reputational fiascos . . . corporate half-truths, deception and sexual misconduct” incidents, many of which have been dominating the headlines.

It turns out that these events frequently don’t resolve easily and can end up producing not just a high level of mistrust among consumers but they can also cause mistrust by investors, which can result in a large and prolonged hit to the stock valuation.  Racanelli reviewed the cases of a number of large companies currently in the news, including Wells Fargo and Facebook. He  interviewed a number of stakeholders to discuss this issue and one person he spoke with was Dr. Jonathan Tiemann:

Not surprisingly, $60 billion in market value was lost by Facebook in just a few days following revealing news as to how negligent the company was over the improper use of personal data by Cambridge Analytica in the run-up to the 2016 election. Critics have said that privacy concerns were placed secondary to profit.  Even after the company learned of the improper access, they did little to rectify the situation.

We recommend you read the full article at Barrons, “Corporate Scandals Have a Cost for Investors” by clicking this link.

By | 2018-04-13T12:34:51+00:00 March 27th, 2018|Business News, Corporate Actions|0 Comments

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