Why Mortgage Applications Just Dropped 15%

Harvards business dean faces own ethical dilemma

(Reuters Breakingviews) - Harvard Business School's dean faces his own moral dilemma. Nitin Nohria essentially wrote the book on ethics and leadership. But he also sits on the board of Tata Sons, the Indian conglomerate at the centre of a corporate governance scandal. The link risks damaging the brand of one of the world's top business schools by suggesting its leaders don't practise the values they charge a fortune to teach. Nohria has cosy links with the Tata family. Nohria was named dean in 2010, becoming the first person from outside North America to hold the position. A few months later group patriarch Ratan Tata gave Harvard $50 million; it was at the time the biggest donation the school had received from an international donor in its 102-year history. By the end of 2013, Nohria was sitting on the board of Tata Sons as a non-executive director.

The dean's stoic silence in the messy fight that erupted on Oct. 24 when Tata Sons abruptly ousted Chairman Cyrus Mistry is troubling for several reasons. First, Mistry claims there was "a total lack of corporate governance" at the Indian group. Second, Mistry names Nohria as one of two directors who were "reduced to mere postmen", simply following the orders of predecessor Ratan Tata.

Third, Tata Sons is now seeking the removal of another independent director at some of its separately listed operating companies who has backed Mistry. As top proxy advisory firm IiAS notes, allowing large shareholders to remove outside non-executives undermines the point of having those independent directors and hurts minority investors.

Nohria is recognised as an authority when it comes to ethics. He has publicly mused that "it's easy for people to believe in their own sense of moral responsibility; but what happens when they are put under pressure by bosses or tempted by large short-term gains?" and has insisted "character is something one has to work at forming". Despite his teachings, Nohria does not appear to have had much impact on fostering good governance at Tata. That apparent failing itself subjects Harvard to reputational risk.

Idb to launch $10 bln islamic bond programme in dubai

Nov 3 The Islamic Development Bank (IDB) will set up a $10 billion sukuk issuance programme on the Nasdaq Dubai exchange, a boost to Dubai's efforts to become a top centre for Islamic finance in competition with other cities. It would be the Jeddah-based IDB's third sukuk programme - it already issues Islamic bonds in London and Kuala Lumpur - and its first in a Middle Eastern country. The international lender, which has 56 member countries, promotes economic development in Muslim countries and communities. In January, Dubai launched a drive to become a centre for Islamic business; its exchanges have so far listed $12.5 billion of sukuk and the total is expected to reach $16 billion by year- end, a statement from the office of Dubai's ruler said late on Saturday.

No time frame was given for the launch of the IDB's programme. Its sukuk are highly sought after by Islamic investors because of their AAA credit rating, so they could offer a much-needed boost to trading volumes in Dubai and encourage more issuers from outside the emirate to choose Dubai as their listing venue."As the IDB plans a significant expansion of its activities, Dubai's world class exchange and regulatory architecture together with its commitment to providing Islamic finance solutions of the highest quality make it a natural home for our securities," IDB president Ahmad Mohamed Ali was quoted as saying in the statement.

The IDB also plans to expand its sukuk programme on the London Stock Exchange this month to $10 billion from the current $6.5 billion. It has issued 15 sukuk in London since 2005.

In addition, the IDB has a 1 billion ringgit ($313 million) programme listed on Bursa Malaysia, which has raised a total of 700 million ringgit via three sukuk since 2008. Dubai's announcement comes days after Britain unveiled plans to issue a 200 million pound ($320 million) sovereign sukuk, the first from a Western country, ramping up efforts to promote itself as an Islamic finance hub. Prime Minister David Cameron announced the intention during the World Islamic Economic Forum, a major conference for the industry, in London last week; the event will be held in Dubai next year.