Boston Scientific turns lemons into rotting fish

Decision to ban reporters from stockholders meeting will only makes matters worse

Times have been tough for medical device maker Boston Scientific: a $1.6 billion first-quarter loss, highly publicized legal and regulatory beatings, and, predictably negative fallout from a decision to pay new CEO J. Raymond Elliott $33.5 million in total compensation last year.

So with a sure-to-be-contentious stockholders meeting scheduled today, company executives have decided that the best way to put a cap on the flow of bad news is to ban reporters from attending as the press has done routinely in the past. ... Good luck with that.

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The Boston Globe, whose reporter was among those denied access, spoke to a couple of experts regarding the strategy:

"It's not the best practice to close a meeting,'' said Beth M. Young, senior research associate at the Corporate Library, a Portland, Maine, research firm that tracks shareholder issues. "It sets a tone and creates a feeling of distrust and secretiveness, which is not what a company wants to do when it's facing challenges.''

What she really means is that it reeks.

Frank Glassner, chief executive of Veritas Executive Compensation Consultants, a pay consulting firm based in San Francisco, said, "Very generous executive pay in light of very poor company performance may have something to do with it. Probably, the best thing Boston Scientific could do at this point is to establish transparency.''

Boston Scientific knows this looks bad, which leads one to believe that whatever the reporters might see and hear at the meeting could only be a lot worse.  ... And I'll bet it's in tomorrow's Boston Globe.

(Update: Meanwhile, Boston Scientific today has also issued a press release regarding an upgrade to its software that lets doctors remotely monitor patients who have implantable cardiac devices. I'm sure the press will be anxious to cover this news.)

(Update 2: And while we're pointing to Boston Scientific-related items, here's one from today's Huffington Post entitled: How to Get Away With Murder: Guidant and Corporate Criminal Justice. Surely not the kind of thing one wants discussed at a shareholders meeting and reported by the newspapers.")

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