We applaud ENR’s recent article on corporate governance (ENR 7/21 p. 24). Certainly, Sarbanes-Oxley and the many SEC and NYSE-NASDAQ initiatives have kept us all busy over the last year. Corporate governance is important to all stakeholders of companies, especially those publicly held.

But ENR should inform its readers about changes in another area just as important to every construction firm, both public and private, that performs work for public agencies. This is the area of ethics and corporate compliance and the impact on corporations, directors and officers, of the U.S. Sentencing Commission’s organizational sentencing guidelines and a landmark case in Delaware.

Any firm that performs public work and does not have an “effective” ethics and corporate compliance program in place to detect and ferret out wrongdoings places itself in danger of losing a substantial portion, if not all, of such work through debarment and suspension. Moreover, directors and officers might also be exposed personally.

David H. Watts
Chairman and CEO

Michael Futch
Vice President and General Counsel
Granite Construction Inc.
Watsonville, Calif.

Keep a Diverse Portfolio

I used to work for an employee-owned company, which cured me of that habit (ENR 8/18 p. 24). Owning too much stock in any one firm is never a good idea. Employees need to think like entrepreneurs, which means doing what is best for them. If company stock looks like a good investment, fine. But it’s still no excuse for putting all your eggs into one retirement basket. Unfortunately, Employee Stock Ownership Plans (ESOPs) encourage this reckless practice.

 
William T. Pepoon
Consultant
Lenexa, Kan.