Transcript
Welcome to business pants. We are free flow. We are. Matt Ari. Chessie Damien, today's podcast. Business pants, corporate theater. Let me hand it off to our MC. And get the show going. Our corporate theater players this week. Oh, the extraordinary Courtney Cook, Phil Haack, Ashley kutza and Mark McGee. This week on the show, we on Earth, the origin story, behind these kooky, and you will see CEO letters to shareholders made famous by big cuddly billionaire, teddy bear, Warren Buffett. And then we take a Twinkie Spazzy frenetic, conspiracy laced. Look at Short seller, Hindenburg research. Up first. Let's talk CEO letters to shareholders, shall we? Where do they come from? What is their purpose? Pull up a chair. And put on your learning cap. Because business pants is taking you to see CEO letter writing School. Hi. I'm Gunther lewallen head of content here at the business pants podcast and if you're a corporate governance junkie like me, well, you even notice that we are in the thick of the CEO letter to shareholders season, these letters come out right before the annual meeting of the shareholders. Much like the United States, President State of the Union speech. CEO takes on the role of a corporate cheerleader in a statement that is, that is more public relations fluff than on US Cold Hard facts. Now many shareholder letters have been known to contain hidden messages that if that if properly deciphered can tell you exactly how a certain company is doing and unveil Clues to any potential impending, doom related to the financial institution as a whole. A careful reading of the letter, not only focuses on what management chooses to emphasize but also what management chooses to Omit or minimize. To The Savvy. Investor the CEO letter can reveal quite a lot about a company and its leadership. So, how did the annual, CEO propaganda? Declaration tradition begin. Street is a bit foggy. And you'll report started to appear in the early 1900s here in the US, but it is not certain when the first shareholder letter was actually written. That's where our business pants corporate theater. Troupe comes in, They will attempt to show the origin of the CEO letter to shareholders in the following presentation appropriately, titled the origin of the CEO letter to shareholders. We now take you to the office of Humboldt, J, Houseman the president of the Hausman Furniture Company in Glendale Ohio in the year of Our Lord 1917. We hope you enjoy it and more importantly, we hope you learn something too. Good morning, Mr. Houseman, you're here early. Good morning Johnson. Yes. Well, I couldn't sleep last night. Have you heard what Henry Ford is doing now? What now with Hank it was in last night's paper automaker Henry. Ford is instituting a five-dollar a day wage which constitutes double the industry Norm at the same time. Ford reduced the Working Day from 9 hours to 8 becoming the first company in America to adopt a 40-hour work week. What the hell does Ford think he's doing well, sir, there is an ever-growing belief that the task of factoring management is to determine the best way for the worker to do the job, to provide the proper tools and training and to provide incentives for good performance, that includes higher wages and shorter working hours, that ridiculous, Scientific Management theory created by socialists crackpot. W Taylor Crock-Pot or not his ideas. Getting a lot of discussion especially from workers, more money, Less hours. It's a workers dream. It's also a dangerous dream that the successor failure of a company is not solely on the shoulders of the workers that the managers have to take half of the burden of being responsible for, securing the proper work conditions for workers Prosperity. Oh it's a dangerous idea Johnson many think that the real dangers lie in Management's obsession with productivity at any cost over worked. Exhausted workers with, absolutely no incentives. Only leads to apathetic employees that do not care one iota how good a job they do. The best way to advance productivity is to listen to the workers. I'm afraid. Mr. Houseman, that's the future of the worker management relationship. Oh poppycock, I'm also heard some whisperings about A potential government regulations. Limiting the hiring of children under 14. Can you even imagine, no, no, no, no, no, no, no, no. We need to instill, the principles of capitalism in them as early as we can. Work is what God put us on the planet to do there is nothing more rewarding. Well, that certainly one interpretation of God. Mr. Houseman this future of workplace. A quality can only lead to the destruction of the tried and true Imperial management structure that has survived since the primordial slime management is King and workers need to know their place. And Henry, Ford will have a lot of explaining to do with the upcoming captains of industry. Clambake, can I pour us? Soothing bourbon sir. Oh yes Johnson. Thank you. I had a thought last night that made delay, this inevitable future. What if I wrote a letter to the workers? Telling them how good the company is doing and how much I appreciate their contributions something to take the focus away from these unnatural changes. Taking place elsewhere That's an interesting idea. Management communicating with a workers. It's a novel concept. I'm surprised Ford hasn't thought of that. Henry. Ford doesn't care about his workers, he just wants to lead the world in creating new techniques to increase the bottom line using this Scientific Management theory is his latest attempt I see, but but this letter idea, that would be all mine and I wouldn't have to increase wages or reduce hours. Why mess with a perfect system. They work, they go home, they eat, they sleep, and then they come back to the factory. No time to sit around and think it does feel perfect, doesn't it? If I can, convince my workers into believing that they're doing a reasonable job and it's helping the company grow, that should be enough. Right. Convinced into believing, I don't believe for one minute. That our company's success relies on its workers, the men and These offices lead this company. Me a couple of board members of financial experts and the clerk. You have her. That's the company not anyone in the factory. But I can make them believe they have some power. Just think of the possibilities for this type of communication, you could discuss the company's Financial strength, debt levels ongoing or growing problems with cash flow and cost controls. Yes, this could be revolutionary, Mr. Hausman. Hell, are you talking about? I'm going to give them. Hints of candy-coated, bulshit? Not the inner workings of this company. You're talking corporate heresy, Johnson corporate Harrison, speaking of executive officers. Have you heard the latest term being thrown about chief executive officer? You mean instead of President? Yes, it's being used. Quite a lot overseas and is slowly being introduced here in the United States. Oh, I don't like that at all. No, no. The leader of a company should be called president like the president of the United States. Besides chief executive officer would imply that there are many executive officers Milling about how ludicrous and wasteful is that. No, I am president of Houseman Furniture, the leader of the company still, I do think you are onto something with this letter idea. An annual event like the presidential State of the Union Address something for the people to look forward to each year. Just like the king of England's annual Christmas address. I hesitate to say this, but there are other Rumblings of impending government regulations for corporations, especially with more private companies going public and acquiring shareholders. It will never happen, not in this country and not of presidents. Keep our Reigns on our workers and are allowed to run our companies, the way we see fit. But if these regulations come, we may be required to submit an annual financial report to the public, not just employees. That may be a good time to send out. A letter regulations, will be the goddamn death of the American corporation. That's what would be wonderful about this letter. It will be an informal unregulated form of expression. I can say whatever hokey malarkey, I want. But it's not a legally binding document besides people will much more want to read an informal optimistic letter than cold hard balance sheets without a doubt sir. We can make the release of the letter a yearly spectacle. I could give advice and predictions about Corporate America as a whole, not just our company. What is howsman writing about this year? They'll say, well, what advice does? The great Humboldt Houseman have this year? Inspired sir inspired? Oh, I'll be known as Sage of Ohio. Oh, this is good Johnson. This is damn good. All right, let's have a Crack at this letter, shall we? Now, pull you some more bourbons? And like me a cigar where about to change history for Christ's sakes. Take that Henry Ford. Before I get to our last sketch. Let me once again. Thank our business pants, cooperator, in alphabetical order. They are Courtney Cook. Philip hook, Ashley cutter, and Mark McGee. Let's end Today's Show with a delightful conspiracy theory. This one is about short seller. Hindenburg research. Named after the 1937 Hindenburg disaster, which they characterize, as a human-made avoidable disaster. The Firm generates public reports that alleged corporate fraud and malfeasance. Let's listen in to, to twiki. To work. He torpey Tweety Hindenburg research analysts. Meanwhile in the offices of Hindenburg research. Hey, did you see the publicity we're getting already since our latest press release? Yeah. Yeah. It's been great, huh. Henneberg research takes aim at Twitter shares. Plunge block Inc. Stock tumbles on Hindenburg short report after Donnie bomb, Hindenburg research teases and other big report. Yeah yeah people are really talking about us. You know it we are definitely corporate governance game changers. Now we're doing such good work, that is actually making a difference. Yeah, yeah it's great, it's great. Well, listen have you have you ever noticed that some articles? You certain words that well, certain words, that kind of reflect on our name certain words, what do you mean? Well, like, in those headlines, Hindenburg research, takes same. At Twitter, shares plunge, block, stocked, humbles on hinted Berg short report after adani bomb Hindenburg research. He's another big report Plunge. Tumble bomb. Don't you think those all can relate to our name, Hindenburg? I mean, you know, then the 1937 Hindenburg airship disaster. Oh, come on, that's crazy. Those are just all normal words. Used in all Financial related articles. Okay, okay, okay, okay, okay, okay. What. How about these three other examples, Hindenburg research? Alleged that the payment at block had inflated user metrics Hindenburg research the financial research firm with an explosive name, Hindenburg scorching allegations Hindenburg, the short seller that sent the adani business empire into a tailspin inflated explosive scorching talespin. Look I'm sure it's just some harmless tongue and cheek journalism. Nothing to get offended about. Yeah I suppose but have you ever wondered why the company chose the name Hindenburg? The Hindenburg incident, was the epitome of a totally man-made, totally avoidable disaster. Almost 100. People were loaded onto a balloon, filled with the most flammable element in the universe. This was despite dozens of earlier hydrogen-based aircraft meeting with similar Fates. Hindenburg research looks for familiar man-made, disasters, floating around in the market and aims to shed light on them before they lure in more unsuspecting victims, III. I know what it says on our website, but, but don't you think it was still an unusual way to go? I mean, that was a terrible accident that killed. 35, people not even 100 years ago and it's on film. Everyone's seen the footage. It was kind of the 9/11 of its day. Well, you could say that Led Zeppelin went there first true, true true. True. True true but I don't know, I just I just think it's a little dark to have that disaster stand for all the good work we do here. It's kind of like naming something after the Titanic or the Challenger space shuttle or like I said 9/11. No one is ever going to name anything after nine eleven, especially a governance firm. You don't know that in 80 or 90 years, maybe they will whenever people think enough time has gone by Make the disaster seamless terrible but I don't think there's ever enough time to make that happen. I mean using a tragic event to sell your product is pretty dark. Even if the the Hindenburg didn't blow up it was still a great big glaring piece of Nazi propaganda. It had four huge swastikas on its tail fin. That's right. And you know, it's a little unsettling. Look at our logo, it's just a stylized age, right? Yeah. But look at the colors, red and black just like the colors of the swastikas. Holy shit and and see the the top right part of the H. Its kind of resembles, the tail fin where the swastikas were. Okay. Now, this is getting really creepy. I know, I know there's just something wrong about this and then having articles written about us, it's sort of make light of the whole disaster. Like explosive and scorching. Come on. That's terrible. Okay. So what do we do? Should we say anything? Why I actually have a meeting with HR about it. Just just to see if it's a battle. I should even take on. You definitely. Don't want that exploding in your face. No, I didn't want to come across this kind of gas bag. You do not want to spark any controversy, know or ignite any unwanted attention. And you surely don't want to get fired. No, I don't want to get fired. Oh, look, it's five o'clock. Let's blow this joint. We are bored sabermetrics and we will be back tomorrow without this silly voice. I promise And please go ahead. Share this podcast with your pal. Company.