Conrad Black’s exit cheers good governance

Advocates of corporate governance reform are savoring the resignation of Hollinger International Chief Executive Conrad Black, who only a few months ago brushed off reform as a fad.

Black had said yesterday that he would step down from the media company he controls amid disclosures that he and other executives received $32 million in unauthorized payments. This really shows that the present movement toward corporate governance reform can even force an organization which is almost completely dominated one central figure to bow to needed changes,” said Paul Hodgson, senior research associate at the corporate library, a corporate governance watchdog.

Hollinger International, publisher of London’s Daily Telegraph and the Chicago SunTimes, has long been criticized by investors for its complex ownership structure and sagging share price.

The governance problems “happened through arrogance and ego, in the context of a time where greed ruled and the corporate CEO was unchecked”. Said Herbert Denton, a shareholder advocate who is advising some institutional investors in Hollinger International. “How it unraveled was through a campaign predicated on publicity to cause the very prominent board members to do the right thing”.