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A White House study argues that race-based hiring policies have reduced productivity in industries that adopted them. Using minority representation in management as a proxy for diversity, equity and inclusion (DEI) adoption, the authors say productivity in those industries was 2.7% lower by 2023 and estimate a 0.34% hit to U.S. output. “There is nothing inherently less productive about minority workers or minority managers,” the study says. “The issue is rapidly promoting unqualified workers in order to meet racial quotas set forth by DEI.” The report observes that the “previously virtually unknown” position of chief diversity officer became the “fastest-growing C-suite executive position.” However, some aspects of the study could raise questions about its conclusions, the Wall Street Journal notes.

 

Wall Street Journal

According to a new Gallup poll, more American workers are integrating artificial intelligence (AI) into their jobs, yet skepticism about the technology persists. The survey reveals that while 30% of employees frequently use AI, many remain concerned about job displacement due to new technologies. Scott Segal, a social worker, expressed his worries, saying: “I think everyone who works in a replaceable field or trade should be planning ahead.” The poll highlights that 40% of workers report their organizations have adopted AI tools, with two-thirds noting a positive impact on productivity. However, about half of U.S. employees said they use AI infrequently or not at all, citing ethical concerns and a preference for traditional methods. The fear of job loss is growing, with 18% of workers believing their jobs may be eliminated in the next five years due to AI advancements.

 

U.S. News

OpenAI is deepening its partnership with Amazon Web Services, signaling a strategic shift away from Microsoft as it chases surging enterprise demand. An internal memo described customer demand as "frankly staggering" and said the Microsoft alliance had limited OpenAI's reach. Amazon has committed $50bn to OpenAI and will become the exclusive third-party cloud distribution provider for OpenAI Frontier, its new agent-management platform.

 

Axios

Novo Nordisk is partnering with OpenAI to deploy artificial intelligence across its business. The partnership will aid the identification of promising drug candidates and improve efficiency in ⁠manufacturing, supply chains, distribution and corporate operations. The Danish firm, the maker of Wegovy and Ozempic, said OpenAI will also help train its global workforce, increase AI literacy and boost productivity across departments. "The aim here is not replacing our scientists. It's about supercharging them," Novo Nordisk CEO Mike Doustdar said.

 

Reuters

A hacker has gained access to a Bain & Co internal AI tool used by part of the consultancy’s private equity practice to help assess companies for due diligence and investment analysis. CodeWall - an autonomous offensive security platform - said it had a foothold on the platform within 18 minutes. The hacker has previously exposed cyber security flaws in systems at rival consultancies McKinsey and BCG.

 

CodeWall

Financial Times

Former Lafarge CEO Bruno Lafont has been sentenced to six years in prison for paying €5.6m ($6.6m) to Islamic State (IS) and other terror groups in return for allowing the company’s workers continued access to its Syrian plant. Lafarge, which is now part of the Swiss conglomerate Holcim, paid the money via its subsidiary Lafarge Cement Syria (LCS).  Seven other employees were also found guilty on terrorism charges. "These payments took the form of a genuine commercial partnership ‌with the Islamic State," said presiding Judge Isabelle Prevost-Desprez. "This method of financing terrorist organizations, and primarily IS, was essential in enabling the terrorist organization to gain control of Syria's natural resources, allowing it to finance terrorist acts within the region and those planned abroad, particularly in Europe." 

 

Deutsche Welle (EN)

France 24

Financial Times

The Guardian

Securities and Exchange Commission chair Paul Atkins has said retail investors should “get out of the kitchen” if they cannot “take the heat” of investing in private credit.

 

Financial Times

PwC is navigating significant internal challenges as it continues to expand its operations globally, with reported revenues exceeding $50bn in 2023. The firm is grappling with contrasting dynamics between its traditional accounting services and its rapidly growing consulting arm, which has seen a 15% increase in demand. This dual focus has led to strategic tensions within the organization, affecting over 300,000 employees worldwide. As PwC aims to balance these divisions, it faces the challenge of integrating its services while maintaining its competitive market position, crucial for sustaining future growth in an evolving global landscape.

 

Going Concern

The Commerce Department has reported that U.S. wholesale inventories rose 0.8% in February, marking the largest monthly increase in 13 months and rebounding from a 0.3% decline in January, driven by gains in professional equipment and a 1.5% surge in electrical goods. On an annual basis, inventories increased 1.8%, and if sustained, could contribute positively to first-quarter GDP growth. Wholesale sales also strengthened, rising 2.7% in February, reducing the inventory-to-sales ratio to 1.22 months from 1.25, indicating improved demand alongside stock rebuilding.

 

Reuters

RTT News

U.S. investor-owned utilities are planning about $1.4trn in capital spending over five years, up more than 20% from a year earlier, as they upgrade aging grids and prepare for surging electricity demand from AI data centers, manufacturing, EVs, and housing growth. The investment wave could intensify pressure for rate increases as household power costs already outpace broader inflation. Charles Hua, executive director of PowerLines, called it “a live political football,” while utilities argue the spending is needed to preserve reliability and manage long-term costs.

 

Wall Street Journal

The Governmental Accounting Standards Board (GASB) is proposing a significant change to the structure of guidance on U.S. GAAP for state and local governments, aiming for a unified approach similar to FASB's. The discussion memorandum titled "The Structure for Communicating Generally Accepted Accounting Principles for State and Local Governments" invites stakeholder feedback before GASB finalizes its stance. The goal is to assess the effectiveness of the current dual-authority structure, which complicates the maintenance of GAAP as more standards are issued. GASB is exploring whether to adopt a single-authority structure, with input requested by August 31, 2026. As stated in the memo, "the focus instead will be on considering how GAAP is communicated and maintained."

 

Accounting Today

The ongoing war in Iran has prompted several U.S. states, including Indiana, Georgia, and Utah, to consider suspending gas taxes to mitigate rising fuel costs for consumers. Indiana has already enacted a temporary tax holiday, costing the state approximately $50m monthly, while Georgia and Utah are evaluating similar measures. As the conflict has driven gas prices to $4 per gallon, marking a 30% increase compared to last year, states are responding to public pressure for relief. Despite a recent ceasefire, gas prices remain elevated, leading to continued discussions on tax suspensions. However, these measures could strain state budgets, which are already facing challenges due to reduced federal funding and slower revenue growth, raising concerns among policymakers and analysts regarding long-term fiscal stability.

 

Accounting Today

Business optimism among Britain's finance chiefs has reached a six-year low, according to Deloitte's latest survey of CFOs. The confidence index fell to a net -57% from -13% in the previous quarter, driven by concerns over energy prices, inflation, and interest rates amid ongoing geopolitical tensions. Ian Stewart, chief economist at Deloitte U.K., commented: "The conflict in the Middle East is reshaping business sentiment." CFOs are increasingly adopting defensive financial strategies as they face rising risks, with 61% citing energy costs and inflation as top concerns.

 

The Scotsman