From the editor.

It's hard not to turn on the news or pick up a newspaper and not be aware of the potential for startling economic or political news, emanating from anywhere in the world. But companies don't have to operate in a reactive shell, writes Prof. Peter Navarro in our cover story. Based on research he and colleagues have conducted, he argues that companies that understand business cycles and can plan around exogenous shocks are better equipped to outgrow and outperform lesser prepared peers.

In the third installment of our series celebrating FEI's 75th anniversary, Dr. Robert A. Howell traces the evolution of the senior finance executive role over the past seven decades. Howell, a distinguished researcher and thinker about corporate strategy, finance and accounting, delivers an insightful and highly readable look at how changes in the economy, corporate strategy and policies helped alter and elevate the role of the controller in the 1930s to today's CFO.

Robert Davis knew he was signing on for a big challenge when he joined Computer Associates as CFO last year. The venerable software firm, wounded by an accounting scandal, is rebuilding its management team, processes and--if Davis has anything to say about it--its reputation. He spoke with me about how the recovery is faring, as well as the issues raised by the deferred prosecution agreement the company is facing.

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Even as the stark images of the damage from Hurricanes Katrina and Rita remain with us, another hurricane season is approaching. Executive Editor Ellen M. Heffes examines some research about business continuity and interviews three executives whose companies were battered by Katrina last year to find what lessons they have to offer.

"Global sourcing" is the latest in-vogue term--some might say, euphemism--for outsourcing, and far more palatable to many ears than "offshoring." Yet, thinking in terms of sourcing globally probably does represent the best way of defining how leading-edge companies are approaching their business process and service needs, finds Financial Executives Research Foundation (FERF) Director of Research William Sinnett.

In a somewhat related article, consultant Robert A. Rudzki reviews the impact of new and very powerful processes and tools around procurement, adopted by progressive companies over the past two decades. "Done well, advanced procurement and supply management can trigger a compounding positive effect on a company's lifeblood--its return on invested capital," he writes.

Belgium may be best known for its chocolates and beer, and as the headquarters for the European Union, but it wants to be a magnet for multinational companies. Ellen Heffes examines how the company's new tax incentive programs are intended to vault it into a competitive position with such favored tax jurisdictions as Switzerland and Ireland.

Sarbanes-Oxley compliance has a lot of pieces, and one key internal control revolves around written investment policies. Bear, Stearns & Co. cash management executive Richard Saperstein reviews the key components of such policies and details what executives should focus on to ensure they are sound.

Then there's the never-ending saga of the efforts to meld U.S. and international accounting standards. Sir David Tweedie, the ever-optimistic Scot who chairs the International Accounting Standards Board, tells Ellen Heffes that he's actually seen more progress in the past four years than he had originally expected--that he thought it would be "more of a slog." For those of us on the outside, though, it often seems just that.