With investors fleeing the market like long-haired rabbits in a prairie fire for more than two years, it boggles the mind that many public companies still have CEOs doubling as the company’s chairman.

If you see the dreaded slash in the boss’s title (i.e. chairman/ CEO), dig deeper. It may be a red flag. And if you see the same surname nine times on the list of board of directors and the company isn’t delivering the goods, raise a little hell.

Stand up and grill the chairman/ CEO at the annual meeting about the conflicts of interest. If there’s a slash in the boss’s title and the company’s corporate governance stinks, slash the stock.

Don’t be afraid to cast your vote – with your wallet. Ruthless corporations deserve ruthless scrutiny.

At a time when handcuffs, not cufflinks, are all the rage on Crook Street (formerly known as Wall Street) and investors will dump stock if they don’t fancy the colour of the CEO’s tie, why would anyone want to own shares in an organization that has a board that resembles a country club?

If a family reunion breaks out at a board of directors meeting, you’d better be concerned. In a market environment where shareholders have been burned by companies like Enron and WorldCom that had boards sadly lacking in independence and the ability to properly scrutinize accounting and financial reports, public companies ought to be going the extra mile to reassure investors.

And having the CEO in a dual role as chairman is anything but reassuring. It’s a recipe for disaster. Yet, about 17 per cent of the top companies in Canada were still piloted by chairmen/CEOs in 2001.

How can a board be expected to have a tight rein on a CEO who is its chairman? In some cases, a company may flourish with a chairman/ CEO. An example of that is Calgary-based Forzani Group (FGL-TSX), the sporting goods retailer whose stock has been on fire with chairman/CEO John Forzani at the helm.

But the dual role still sends the wrong message – a mixed signal – to shareholders.

Calgary-based Mullen Transportation (MTL-TSX) has also been a recent winner with shareholders, but there is cause for concern when the CEO – Murray Mullen – is doubling as chairman and, to boot, there are four Mullens on a board of eight directors. Stock in Calgary-based tech companies such as Wi-Lan (WIN-TSX), Axia NetMedia (AXX-TSX) and Oncolytics Biotech (ONC-TSX) have been tanking mightily for more than two years.

Yet those companies continue to operate with CEOs who are also the chairmen – Hatim Zaghloul (Wi-LAN), Art Price (Axia) and Brad Thompson (Oncolytics). Board meetings of Calgary-based Atco Group (ACO.X-TSX) are also family affairs with co-CEOs Ron Southern and daughter Nancy Southern doubling as co-chairs.

With stock in Shaw Communications (SJR.B-TSX) dropping like a stone this year, off 60 per cent from its 12-month high, shareholders should take note – three of Shaw’s directors are named Shaw, including chairman J.R. Shaw, father of the CEO, Jim Shaw.

Among other chairmen/CEOs of Alberta companies are Bernard Isautier of Calgary-based Hurricane Hydrocarbons (HHL.A-TSX) and Stephen Collicutt, head of Red Deer-based Collicutt-Hanover Services (COH-TSX), whose stock has been hammered to $2 from a 12-month high of $7.

Most of the major players in Alberta’s oilpatch draw top marks for corporate governance. Three oil and gas firms – Petro-Canada (PCA), Suncor (SU) and Shell Canada (SHC) – cracked a list of Top 25 boards of TSX-listed companies featured in a recent issue of Canadian Business.

Petro-Canada, featuring a largely independent marquee board that stars chairman Brian McNeill, shared top spot with Royal Bank (RY-TSX) in the magazine’s annual survey.

Yet, even with the issue of corporate governance heating up with every scandal, media-shy Petro-Canada and “Silent” Ron Brenneman, the CEO, aren’t exactly pumping the rave review. A check of the Calgary company’s website shows no mention of the story and Canadian Business failed in a bid to score an interview with a Petro-Canada director.

The only noise we hear from this well-heeled company is the racket from those ringing cash registers.

But, considering the foul mood of the investing public, is this a time for any company to be resting on its laurels?

* SIGN OF THE APOCALYPSE? Ross Healy, a Bay Street bear back when the bulls were still pumping the stock market, recently exhibited strangely bullish characteristics during an episode of Market Call on ROB-TV.

Then, the same man who has been harping throughout the bear market about the pitfalls of investing in tech companies, particularly those without earnings, made Research In Motion (RIM-TSX) and its blood-red balance sheet his No. 1 pick!

Healy’s office at Toronto-based Strategic Analysis Corp. tells us the company president, a regular contributor to the Edge Pro’s Three Stars column, is on vacation.

Good idea, Ross.

* SAGE ADVICE: “Remember the old Irish adage: ‘Live every day as though it’s going to be your last, and one day you are going to be right.’ ”

- Anthony J.F. O’Reilly, former CEO of H.J. Heinz Company



HOT ALBERTA STOCK: Wittke Inc.
WKE-TSX $12.31
Up $2.82 (+29.8%) on 1,825,800 shares (for week ending Aug. 16).
In a bear market, there’s nothing like sifting through the garbage for a winner. Wittke, which manufactures garbage truck bodies and other large truck bodies, came up smelling like a rose when U.S.-based manufacturer Federal Signal Corp. (FSS-NYSE) made an offer to buy the Calgary-based company in a deal valued at $12.50 per share. The stock traded 1,808,400 shares on the news in one day. Wittke was an Edge Pro’s 3 Stars pick of Mawer Investment's Martin Ferguson seven months ago at $8.25.



COLD ALBERTA STOCK: Canscot Resources
CAG-TSX Venture 80 Cents
Down 20 cents (-20%) on 1,600 shares (for the week ending Aug. 16).
Riding oil and gas juniors like Canscot can be wilder than eight seconds on a bucking bronc named Natural Gas. Stock in this Calgary-based company continued its rocky ride on weak volume. Canscot announced in June a discovery of natural-gas accumulation at its Corbett Creek Property in west-central Alberta. The company is also the only Canadian
junior with commercial coalbed methane production from the Powder River Basin in Wyoming.