NEWS OF POOR GOVERNANCE CAN JOLT MARKETS
Johnson & Johnson’s Governance Lapse
December 14, 2018
What happened: Johnson & Johnson (JNJ) kept information from regulators and the public regarding the presence of asbestos in baby powder.
Impact: The sharp move wiped $42B of Johnson & Johnson’s market capitalization in one day. Concern over loss of credibility and related legal liability spooked investors more than any evidence of actual health threat arising from trace asbestos allegedly in baby powder.