The Wall Street Journal online

February 12, 2002

Labor Group Lobbies Companies Not to Renominate Enron Directors

By Kemba J. Dunham

Board Scrutiny

The drubbing of Enron Corp.’s board members isn’t over.

Upset over workers and union pension funds harmed by the collapsed Houston energy company, the AFL-CIO is lobbying 21 companies not to renominate 11 Enron directors serving on their boards. Last month, Richard Trumka, secretary-treasurer of the labor group, sent out a letter to the companies, calling for the removal of the directors who are unable to prove how they tried to protect shareholders.

The 21 companies include Comdisco, Motorola and Lockheed Martin. Some are in the process of deciding on board renominations. “This has to be a difficult moment because I think this impulse will be to stand by their directors to preserve the relationship,” says William Patterson, director of the AFL-CIO’s Office of Investment. “That’s the culture of corporate America; board members stick together.”

So far, the AFL-CIO has received eight written responses. (“Nothing substantial,” says Mr. Patterson.) One company’s chief executive, however, called the labor group and said he would pressure the board member to resign if it’s discovered that the director did nothing to protect Enron’s shareholders.

Still, despite the lackluster responses to the AFL-CIO, there have been some resignations since the letter went out. On Jan. 30, Enron director Robert Jaedicke resigned from California Water Service Group’s board where he had served since 1974. A representative of the utility said Mr. Jaedicke resigned on his own. Last week, Wendy Gramm announced her resignation from the fund boards of Invesco Funds Group Inc., a Denver mutual-fund unit of Amvescap PLC, where she had served as an independent director since 1997. An Invesco spokeswoman declined to comment on whether it was Dr. Gramm’s decision to resign. Dr. Gramm didn’t return calls seeking comment.

Former Enron Chairman Kenneth Lay and James Derrick, an executive vice president and general counsel, are both “in the process of resigning” from the board of NewPower Holdings Inc., says a company spokeswoman. She adds that both are leaving the Purchase, N.Y., energy retailer on their own.

The AFL-CIO is taking other steps. Last week, it wrote a letter asking the Securities and Exchange Commission to determine whether Enron’s directors should be banned from serving on all corporate boards. The SEC acknowledged the letter, but would only say that Enron remains under investigation.

Growing Field

The University of Buffalo School of Pharmacy and Pharmaceutical Sciences has created a master’s degree in the arcane field of “pharmacometrics” to meet growing demand in the drug industry. Pharmacometrics uses data analysis to examine factors that determine patient exposures and responses to drugs. Though the Buffalo, N.Y., school has offered a doctorate degree in this field for 30 years, it only recently created a one-year master’s program.

William Jusko, professor of pharmaceutical sciences, says that he gets weekly calls from several major drug companies, which are looking for graduates with this background. Starting salaries range from $55,000 to $80,000.

Better Days?

Top executives expect business conditions within their companies to improve in the next six months. But they aren’t as optimistic about hiring, concludes a new survey of more than 145 senior managers by the Broadmoor Group, a Dallas executive firm.

All of the surveyed retail executives say business will pick up at their companies in the next six months. Results also were strong in other industries: 90% of financial-services executives, 80% of energy/utilities executives and 80% of automotive executives also expect a pickup in business.

But none of the surveyed retail and energy/utility executives expect hiring to increase in their companies, the study found. Only 31% of financial-services executives, 20% of automotive executives and 16% of telecom executives are optimistic about hiring at their companies within the next six months.

Help Wanted

The Federation of Fly Fishers is casting for an executive director.

The 11,000-member nonprofit seeks to enhance the sport of fly-fishing through conservation and education. It educates people about casting, fly-tying and flies, and works with environmental groups to help preserve natural fisheries. It hosts an annual fly-fishing show; the next one will be in August in Livingston, Mont. Its 1,000 certified casting instructors teach less-experienced anglers the sport’s fine points.

The executive director will lead a staff of six but also needs to energize volunteers, says Greg Pitts, the group’s president. The new hire will be based in Bozeman, Mont., and earn a salary in the mid-to-high five figures, he says.

Are you looking for someone who can tie his or her own flies?

“That would be a bonus. What we are really looking for is someone with a nonprofit background who has a passion for outdoor environmental issues.”

What tests will the executive director face?

“We want to grow in terms of membership, make our organization more visible in the press and other areas, and increase our funding capacity.”

What special perks might lure someone to the job?

“Having your job located among some of the finest fly-fishing in the world is one of the best perks we could offer… Some of the best fishing in the lower 48 will be within a two- or three-hour drive.”

When are you hoping to reel someone in?

“We’re hoping to have someone on board within 60 days.”

— Kris Maher