News Scan

Noteworthy

Health and Safety Programs Pay Off

The American College of Occupational and Environmental Medicine (ACOEM) announced the winners of its 2005 Corporate Health Achievement Award: automotive giant DaimlerChrysler Corp. and Quad/Graphics, a Sussex, Wis.-based printer. The award honors U.S. organizations with exemplary employee health, safety and environmental management programs.

Both award recipients achieved significant, documented cost savings through their employee health initiatives, according to the ACOEM. DaimlerChrysler's companywide safety improvement program, implemented in collaboration with the United Auto Workers union in 1999, has helped the company reduce injury rates and lost workdays by more than 75 percent and saved millions of dol-lars in workers' compensation expenses. Quad/Graphics' injury prevention programs resulted in dramatically lower average hospital costs per employee than those of its peers.

Workplace injuries are a heavy drag on companies' financial performance. In 2003, they cost U.S. businesses more than $78 billion in wages and lost productivity, according to data from the National Safety Council in Itasca, Ill. "Safer, healthier workplaces mean increased productivity, more job satisfaction, stronger bottom-line results, less harmful environmental impact and enhanced community relationships," comments ACOEM president Dr. Timothy J. Key, who describes the awards program as "a kind of spotlight that draws attention to the best practices of corporations that are addressing health and safety issues."

SEC Takes Aim at Pension Consultants

The SEC is considering enforcement actions against retirement plan consultancies that fail to disclose the conflicts of interests that arise when their customers include money managers and mutual funds as well as advisory clients. In a report released in May, the agency detailed the results of its examination of practices at 24 pension consulting firms, about half of which were among the biggest players in the industry measured in terms of assets of the plans they advise.

Many pension plan sponsors rely on guidance from consulting firms in choosing money managers and mutual funds. Yet more than half of the advisory firms the SEC reviewed sold products and services to money managers and mutual funds. For some of the consulting firms, the compensation they receive from these sources is a significant part of their annual revenue, according to the report. The SEC's concern is that consultants' recommendations to their advisory clients may be influenced by their relationship with these other customers.

Investment advisers have a fiduciary responsibility to their clients that includes the duty to disclose all material conflicts, the report notes, but some firms seemed unaware of that fact.

"It's clear from our examinations that many pension consultants must do more to identify conflicts of interest in their activities and to take steps to mitigate or eliminate those conflicts," notes Lori Richards, director of the SEC's office of compliance inspections and examinations. "We urge pension consultants to take a hard look at their disclosure and make improvements. And when a consultant holds itself out as providing unbiased, objective advice, that obligation must be met."

Lawson Merges With Intentia

Lawson Software Inc., the St. Paul, Minn.-based enterprise resource planning software provider, will merge with Stockholm, Sweden-based Intentia International AB in an all-stock transaction valued at $480 million. The merger will create a new company with more than 3,500 employees serving some 4,000 customers in 40 countries around the world. It will retain the name Lawson Software.

Intentia and Lawson have primarily pursued midmarket customers; the new entity will be the largest enterprise applications supplier dedicated to that market segment, according to Lawson. Intentia's strength lies primarily in the European and Asia-Pacific marketplaces; Lawson's focus is primarily North America. The combined company will pull approximately 45 percent of its revenues from North America, 45 percent from Europe and 10 percent from the Asia-Pacific region.

"This is not a typical software consolidation," says Richard Lawson, chairman of the board for Lawson. "This is a combination of equal companies that has tremendous growth potential in the enterprise software market. The mid-market needs a provider with global reach, a broad product portfolio, industry-specific solutions across multiple categories, world-class partners and staying power."