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A Refresher on Return on Assets and Return on Equity

Harvard Business Review

I talked with Joe Knight, author of the HBR TOOLS: Return on Investment and co-founder and owner of www.business-literacy.com , to learn more about these ratios and how managers can use them. A service business may have expensive computer and IT systems. What is Return on Equity (ROE)? ” How do companies use ROA and ROE?

ROE 8
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Japan Is Counting on Shareholder Activism to Improve Its Economy

Harvard Business Review

In Japan several factors combine to help insulate managers from outside influence, including cross-holdings where the company owns shares in a partner firm, docile boards mostly composed of company executives, and a court system historically biased against investment funds. By and large, they failed.

ROE 8
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Would You Want Carl Icahn to Run Your Company?

Harvard Business Review

"We have a dysfunctional corporate governance system in the United States and nobody can attack it and nobody can do anything about it because it's like the feudal system." That's Carl Icahn, in a fascinating interview with Reuters BreakingViews (thanks to Jeff Glekin and Lucy Marcus for pointing me to it).

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Don't Confuse Engagement with User Experience

Harvard Business Review

The Android operating system has been outselling Apple's iOS by nearly a 5:1 ratio. Put another way, Apple's UX metric seems to encourage ROE — Return on Engagement — where Android emphasizes ease-of-use and opportunity. Mobile designer Luke Wroblewski captures the conundrum perfectly: What explains. The numbers don't lie.

ROE 10
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How Companies Can Use Investors to Their Advantage

Harvard Business Review

Nikon, the legendary Japanese camera maker, provides a textbook study in how smart managers can work with strategic investors to transform a struggling business. It also called for streamlining headquarters and cutting executive management’s compensation. Heini Wehrle/BIA/Minden Pictures/Getty Images.

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Women Directors Change How Boards Work

Harvard Business Review

Whether one agrees with quotas as a mechanism for an increase or not (spoiler: men are less likely to ), a new look at Norway, which has a mandatory quota system of 40%, is helpful in understanding why having at least three women on a board is important. Higher quality monitoring of and guidance to management.

Osgood 8
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Idle Funds are the Devil's Playground

Harvard Business Review

He cited the International Monetary Fund's 1997 judgment that "Malaysia is a good example of a country where the authorities are well aware of the challenges of managing the pressures that result from high growth and of maintaining a sound financial system amidst substantial capital flows and a booming property market."

Banking 11