Corporate governance - Vigil

Global investors strongly prefer an active approach to ESG. Threequarters use active funds to integrate environmental, social and governance (ESG) issues — more than double the proportion using passive funds and trackers. Rather than investing in funds that merely screen out unethical sectors, investors want managers to identify and manage ESG risks and opportunities through bottom-up security selection and fundamental analysis.

Since the onset of the COVID-19 pandemic, the number of whistleblower complaints received by regulators has exploded on both sides of the Atlantic. On November 15, 2021, the US Securities and Exchange Commission (SEC) reported that it paid out more in whistleblower awards in fiscal year 2021 than in all prior years combined since the whistleblower program began in 2011. The agency announced that it paid out approximately $564 million to 108 individuals based on over 12,200 whistleblower tips – an approximately 76% increase in tips from fiscal year 2020. This comes after the agency reported a historic increase in the number of tips received in fiscal year 2020, including 6,900 whistleblower tips, which was the most it had ever received in a single fiscal year until that time. The trend is similar in Europe, with two notable whistleblower protection charities (Protect and WhistleB ) reporting an increase of up to 40% in the number of whistleblowing complaints in 2020-21 when compared to previous years.

A major Cominar unitholder is hiring a proxy adviser to launch a battle against a $2.2-billion privatization plan, saying the offer undervalues the Quebec trust’s portfolio of office, industrial and retail properties.

George Armoyan, who held 9.98 per cent of Cominar’s units as of early November, said he is retaining Gryphon Advisors Inc. for a “just say no campaign” to the deal.

Women Corporate Directors (WCD), a global membership organization and community of women corporate directors, and Castellan, a leader in business continuity and operational resilience solutions, released today a joint report to highlight the results of a survey which assessed the extent to which corporate boards are prioritizing operational resilience and business continuity-related issues. This report comes at a time when the complexity, frequency and significance of business disruption continues to increase.

For funds focused on ESG (environmental, social and governance) principles, the “E” remains king as a magnet for investors. 

From January through October, mutual funds and exchange-traded funds specializing in environmental themes attracted far more cash than those ESG funds that focus on other sustainability areas, fund-flow data from Morningstar show.

This new guide from DFIN is designed to help you evolve your proxy into a more effective communications piece.

It provides a searchable resource of best practice examples of innovative and shareholder-friendly proxy statement sections, drawn from public filings.

On November 17, 2021, the U.S. Securities and Exchange Commission (SEC) adopted new Rule 14a-19 and amendments to existing rules under the Securities Exchange Act of 1934 to require the use of “universal” proxy cards in all nonexempt director election contests at publicly traded companies in the U.S. The new “Universal Proxy Rules” contain only slight modifications from rules the SEC first proposed in October 2016, for which the SEC reopened the public comment period during 2021. The rules will take effect for shareholder meetings after August 31, 2022. We expect a significant increase in proxy contest threats once the Universal Proxy Rules go in effect.

Joe Natale presented the board of Rogers Communications Inc.
with a list of demands aimed at protecting his authority as CEO, but the board rejected the requests, resulting in his dismissal this week.

The board of the telecom and media giant voted on Tuesday night to remove Mr. Natale as chief executive officer and install Tony Staffieri, the company’s former chief financial officer, in the role on an interim basis. The move followed weeks of boardroom tension that broke out in late September, when chair Edward Rogers attempted to put Mr. Staffieri into the top job.

Willis Towers Watson is replacing almost half of its board including the chairman, the insurance broker’s latest effort to remake itself following the collapse of a merger with a major rival.

Following talks with activist investor Elliott Management Corp., Willis Towers is replacing four of its nonexecutive directors, including Chairman Victor Ganzi, with four new members. The insurance brokerage giant’s board is composed of eight nonexecutive directors and its chief executive.

Environmental, Social, and Governance (ESG) issues are clearly going to be uppermost in the thoughts of CEOs and their corporate boards in 2022, if recent research by KPMG is anything to go by.
 
The idea that companies need to act as corporate citizens is not new, but the pressure from customers, investors, and government to meet the highest standards continues to grow. The KPMG research suggests that many CEOs are under pressure to meet these expectations, with a good proportion feeling that expectations were growing too quickly.

Gone are the days where organizations are mechanically evaluated based on balance sheets and book value alone. Tangible assets are now merely a piece of the corporate pie. A well-articulated sustainability plan is a necessary ingredient. Environmental, Social and Governance (ESG) considerations are the three foundational areas of corporate sustainability. An ESG-centered approach to business considers non-financial factors that nonetheless have financial consequences. ESG companies integrate environmental, ethical and social responsibilities into their business strategies and corporate cultures.

Capital markets are cast as both villain and hero in the climate playbill. The trillions of dollars required to combat climate change leave ample room for heroics from the financial sector. For the time being, however, capital continues to flow readily toward fossil fuels and other carbon-intensive industries. Drawing on the results of an empirical study, this Article posits that ratings of corporate climate risk and governance can help overcome pervasive information asymmetries and nudge investors toward more climate-conscious investment choices with welfare-enhancing effects.
In the absence of a meaningful price on carbon, three private ordering initiatives are trying to mobilize capital markets as a force for good in the war on carbon. But shareholder climate activism, calls for better climate-related financial disclosures, and the divestment movement have yet to usher in the paradigm shift toward low-carbon capitalism.

Glass Lewis’ 2022 Proxy Voting Policy Guidelines are now available for the United States and Canada, Continental Europe, and the UK. In addition, we have released our 2022 Environmental, Social & Governance (ESG) Initiatives Policy Guidelines, covering shareholder proposals. Guidelines for additional markets will follow over the coming weeks.

Galloping inflation is a major headache for Canadian households, but not for Ottawa’s finances.

The biggest price surge in two decades is set to deliver a revenue bounce worth billions of dollars as the government prepares to deliver a fall fiscal update.

The April budget presented a picture of an economy rebounding briskly, with a burst of moderately higher inflation. In the intervening months, however, that assessment has turned out to be overly optimistic.

Cannabis giant Canopy Growth Corp. is replacing its chief financial officer and long-serving chief product officer, in an executive shakeup that comes barely two weeks after the company reported weak earnings.

In a statement released Friday morning, the Smiths Falls, Ont.-based pot producer said Mike Lee, its executive vice-president and chief financial officer, and Rade Kovacevic, its president and chief product officer, would be stepping down from their roles immediately, before formally departing the company on Dec. 31.

Microsoft’s Xbox chief told employees the company is evaluating its relationship with the gaming company amid questions about its handling of sexual-misconduct issues

CVS Health said Thursday that it will close about 900 stores over the next three years, as it adjusts to shoppers who are buying more online.

Shares rose 2.81% to close at $95.34. With the day’s gains, CVS shares are up about 40% this year, bringing its market value to $125.81 billion.

A shift to the cloud requires boards to weigh numerous implications, from the technology infrastructure to cybersecurity.

Investing based on environmental, social and governance (ESG) factors shows no signs of slowing down.

Global sustainable fund assets almost doubled in the past six months to $3.9 trillion at the end of September, according to Morningstar Inc. The number of sustainable funds, as defined by Morningstar, jumped more than 51% in the third quarter to 7,486 funds.

Sony Group Corp.’s PlayStation unit has asked Activision Blizzard Inc. to explain how it plans to address a Wall Street Journal article about its chief executive’s handling of sexual misconduct issues.

PlayStation boss Jim Ryan disclosed the request in a letter to employees Wednesday that was reviewed by the Journal. In it he said Sony reached out to Activision “to express our deep concern” about the article and that “we do not believe their statements of response properly address the situation.”

Facebook is an archetypal example of a high-growth company’s success, but the model of prioritising exponential user acquisition does not bode well for its responsibility. If the current regime of censure and sanctions on companies and CEOs does not incentivise greater corporate responsibility, then what will?