Bernard’s ‘8 Things’ morning briefing
In the political economy today, the FMA's Rob Everett has warned banks and insurers to work harder to stop an erosion of trust in New Zealand's finance sector.
Rod Oram looks at the Productivity Commission's recommendations for farmers on greenhouse gas emissions, and Nicola Kean reviews the extraordinary book on the rise and fall of Elizabeth Holmes' blood testing company Theranos, which closed this week.
We also have our regular Friday features of my Weekend Reads and People Moves this week.
1. Everett doesn't hold back
Financial Markets Authority chief executive Rob Everett delivered a clear message to banks and insurers yesterday: 'you're rapidly losing trust and you need to shape up.'
He told an industry conference New Zealand’s finance sector was mired in a culture dominated by how much money companies and senior managers can make, and customers are losing out - sometimes big time.
Everett said in the pull-no-punches speech titled 'Is trust the new currency?' there had been a dramatic - and in many cases justified - fall in consumers’ trust in the financial services companies meant to be serving them. And our banks and other institutions were being far too slow to change how they operate to win back that trust, he said.
“What seems to happen in financial services is an insidious slide into ‘it feels a bit tacky, but everyone else is doing it and we can’t afford to be left behind’,” Everett told attendees at the Financial Services Council and Workplace Savings NZ 2018 national conference.
See the full report from our Business Editor Nikki Mandow on Newsroom Pro, where it was first published yesterday.
2. Oram: Farmers can do much better
The Productivity Commission suggested farmers may not have to do much more to reduce methane emissions.
But Rod Oram argues in his column for Newsroom Pro this week farmers should drop their usual excuses and take greater action.
It's an in-depth challenge to any complacency that might be generated by the report.
See his full column here on Newsroom Pro.
3. Ray Avery's legal threat
Newsroom's Eloise Gibson has been pulling at the threads of Sir Ray Avery's activities and has found he tried to suppress publication of a clinical study carried out at Auckland Hospital showing that an intravenous drip controller he was promoting didn’t work as well as expected.
Trials at Auckland City Hospital in 2008 revealed it was not more accurate than a ubiquitous 50c device known as a roller clamp, which health workers in developing world hospitals already use widely.
In 2015, Avery legally threatened a researcher to try to keep the clinical trial findings quiet. He requested a “quiet retraction” of a paper a team of researchers had sent to a medical journal, telling one researcher “you really don’t want this from a career perspective”.
In a follow-up email to the same researcher he added that his lawyer, Mai Chen, had “successfully removed similar material [from the public domain] on a previous occasion, so it can be done”.
See Eloise's extensive and thorough report here on Newsroom.
4. When the blood turns bad
Blood testing company Theranos rose to mighty heights thanks to a charismatic CEO, Elizabeth Holmes (pictured) and a big idea (easy, cheap and sophisticated blood tests). But it was a scam unravalled by a journalist. Theranos closed this week.
New Zealand political journalist Nicola Kean reviews the extraordinary book by that journalist for Newsroom Pro.
I heartily recommend both the book and the review, which should serve as a cautionary tale for any investor or believer in a business idea. See above...
5. People on the move this week
In the political economy this week....
Auckland Council appointed Adrienne Young-Cooper as the new chair of its urban redevelopment agency, Panuku Development. She is also the chair of Housing New Zealand.
Foreign Affairs Minister Winston Peters appointed Greg Lewis as New Zealand’s next Ambassador to Egypt. Lewis is currently Lead Advisor in the Protocol Division at the Ministry of Foreign Affairs and Trade. An Arabic speaker, he has served in the New Zealand Embassies in Cairo and in Riyadh.
Commerce and Consumer Affairs Minister Kris Faafoi reappointed Richard Hunt and Tony Pigou to the Takeovers Panel.
Marama Fox resigned as co-leader of the Maori Party after Newsroom's Laura Walters reported Fox's business had collapsed owing creditors over $70,000.
Chorus appointed David Collins as Chief Financial Officer from December 2018. He is currently Head of Finance & Regulation - Network at Aurizon, Australia’s largest rail freight operator. He will be Wellington based and replaces Chorus’ current CFO Andrew Carroll, who is moving to his new role as Chorus' GM Network and Field Management.
6. Weekend Reads
Here's a few longer reads on political, economic and social issues for the weekend.
This Wired piece on the issue of education for people on the autistic spectrum is well worth a re