The world class Program faculty represent a near perfect balance of academic excellence and industry expertise by drawing from an outstanding pool of instructors from Stanford University, University of Chicago, the National Association of Corporate Directors, and leading global law firms and consultancies. The Program provides the opportunity for executives in Greater China to step back from day-to-day responsibilities in order to acquire a more global perspective and learn new skills essential to the successful leadership of their organizations.
The class will explore the current trends in the aggregation of capital in the hands of various (often global) institutional investors including government pension funds, private pension funds, sovereign wealth funds, mutual funds, private equity groups, venture capital and other alternative investment vehicles. We will identify and analyze the impact of institutional investor influence on trends in modern corporate governance and, in turn, the resulting impact on corporate behavior and operations. Since the phrase "institutional investor" is extraordinarily broad and ill-defined, we will spend time identifying the attributes and characteristics common to different types of institutional investors and will carefully explore how each type of institutional investor generally behaves when considered in the context of a "shareholder" or "owner" of both public and private corporations. Both the theoretical concepts of capital allocation and the practical impact of institutional investing will be evaluated through the use of case studies and hands-on exercises.
This class will teach students several of the most important elements of accounting and finance with an emphasis on common areas of misunderstanding. Exercises and cases will focus on methods that are most likely to yield practical and useful insights when confronting complex corporate challenges.
The accounting portion of the session will cover:
•The Balance Sheet and its components: assets, liabilities, sources of financing with attention to where US GAAP and IFRS differ.
•The Income statement: with an important discussion about what is NOT its purpose - to report income. Once this is understood the session will focus on what is its purpose: to report why income was what it was, so that comparisons can be made across time and companies.
In the process of developing the concepts above, students will learn the vocabulary of bookkeeping—not because executives might ever keep their own books, but so they are not stymied by the vocabulary of ledgers, journals, accounts, control accounts; contra accounts, footing, posting, adjusting, closing.
Additional topics will include: Accrual v. Cash-based accounting, Revenue v. Receipts, Expenses v. Expenditures and the fundamental principles of revenue recognition.
The session will impart the most recent best practices (and advanced methods) concerning the Statement of Cash Flows. Students will learn how to truly understand the Statement of Cash Flows and identify the superiority of the direct method over the indirect method for reporting Cash Flows from Operations.
The finance portion of the session will cover several practical areas of applied finance. The sessions will evaluate and deconstruct the key issues of corporate finance that confront senior executives, directors, and other managers. We will review how managers should make investment decisions and what tools capable executives might use to study and evaluate those decisions. Topics include simple and complex discounting, cash flow analysis; free cash flows, and the incorporation of probability analysis in investment decisions. Discussion will include the role of the cost of capital, how to measure the cost of capital, and how those who manage subordinates that allocate capital might think more clearly about risky projects. We will review the modern relevance of the various Modigliani-Miller (MM) financing propositions and conduct hands-on exercises to demonstrate the different outcomes that result from the use of the various accepted methods of financial analysis.
In contrast to the other course modules that focus heavily on information and analytics, the leadership sessions are all about intangibles.
It is not sufficient for top executives to be world class, analytically and intellectually, in their respective domains. Rarely addressed or studied in a classroom setting is what we call the “athletics of life”—accountability, how to handle competition, operating outside the comfort zone, what to do when a foe is simply better-resourced, dealing with uncertainty, finding workarounds, reading competitors and their motivations, persevering with no guarantees, how to handle failing, managing difficult conversations, and the like. These skills are the difference makers in a world where there are plenty of smart executives. This module will provide training in the kind of leadership X-Factors that will help participants become true game changers.
The session will examine the professional points of contention surrounding corporate governance and, through case studies and student exercises, give special attention to issues of executive compensation. Students will learn a general framework that can be used to describe the various facets of corporate governance both globally and in the U.S. By way of a review of the literature and publications of Stanford’s Rock Center combined with discussion of recent news coverage, students will develop an understanding of the core corporate governance concepts that have a practical impact on global corporate behavior and performance.
After this portion of the course, students will understand the debates about popular “best practices” in corporate governance, be able to make practical decisions about corporate governance in general business settings, and have many of the tools to critically evaluate proposals about or claims as to the effectiveness of various corporate governance practices.
The Foreign Corrupt Practices Act has emerged as one of the single most difficult and costly areas of compliance for U.S. based (or US affiliated) companies dealing with international activities – particularly with those companies with operations in Asia. The FCPA threatens to loom even larger in the coming years for these companies, their partners, their subsidiaries, vendors, and shareholders. This section of the course will identify what senior managers, executives, and directors should understand about the Act, its requirements, and potential penalties for its violation. In addition, we will review how a senior executive can attempt to determine whether his or her company (or customer company) is susceptible to charges of violations and under what circumstances special or extraordinary attention is merited. Several examples of recent or significant enforcement actions will be reviewed by the class and incorporated into hands-on exercises and discussions.
This class is a unique and cutting edge treatment of the important topic of corporate or enterprise risk. The course will take an interdisciplinary approach to the concept of corporate risk by blending the concepts of accounting, finance, corporate governance, management operations and the law to evaluate the sources of corporate risk and identify the best methods to manage this risk. A review of recent corporate crises and related responses will serve as fresh material for class discussion and exercises.
The course will review (or introduce) certain advanced elements of accounting that are often implicated in various types of corporate risk. These include long-term liabilities; leases; long-term assets, amortization, and impairments; deferred income taxes; investments; and financial instruments. Similarly advanced topics in finance will highlight probability analysis and related common errors, the newer theories of options analysis and capital allocation, and the methods and statistics of crisis prediction and analysis.
The course will address the increased risks associated with global, complex enterprises, and the importance of analyzing information flows within the organization. We will discuss how to ensure that the right people are in key positions to manage and oversee risks and how to spot the "red flags" indicating increased risks may exist. There will be a practical evaluation of the common pitfalls companies experience when faced with real risk management issues (the instinct to minimize issues, cover up, and then disclose too early or too little), and a case analysis to demonstrate the need to focus on process within the corporate environment.