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Institut sur la gouvernance (IGOPP)
August 5, 2022 11:37 AM
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This briefing is the third in our series of briefings on corporate governance and is designed to provide a synopsis of topical corporate governance matters impacting companies in the United Kingdom. This briefing tracks the development of certain matters identified in our first and second briefings and outlines new matters of interest. Please see full Publication below for more information.
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Institut sur la gouvernance (IGOPP)
August 5, 2022 10:48 AM
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Amazon is acquiring iRobot for $61 a share in an all-cash deal that values the Roomba maker at $1.7 billion, the companies announced Friday. The deal will deepen Amazon’s presence in consumer robotics. Amazon made a bold bet on the space last year when it unveiled the Astro home robot, a $1,500 device that’s equipped with the company’s Alexa digital assistant and can follow consumers around their homes. It’s also launched an array of smart home devices, like Ring doorbells, as well as voice-activated thermometers and microwaves. [...] The acquisition marks Amazon’s fourth-largest deal, behind its $13.7 billion purchase of grocery chain Whole Foods in 2017, its $8.45 billion purchase of film studio MGM last year, and its $3.9 billion acquisition of boutique primary-care provider One Medical, announced last month.
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Institut sur la gouvernance (IGOPP)
August 5, 2022 10:06 AM
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For over 45 years, Delaware law has permitted directors of Delaware corporations to be exculpated from personal monetary liability to the extent such protections are set forth in the certificate of incorporation, subject to certain exceptions. However, such protective statutory provisions did not reach officers. As contemplated in our April 2022 memorandum, Delaware has now adopted important amendments to Delaware’s General Corporation Law that would expand the right of a corporation to adopt an “exculpation” provision in its certificate of incorporation to cover not only directors (as has been allowed and widely adopted since 1986, following Smith v. Van Gorkom) but now also corporate officers.
This report provides insights about board refreshment policies and practices, as well as director evaluations at S&P 500 and Russell 3000 companies. Our findings are based on data pulled on July 7, 2022, from our live, interactive online dashboard powered by ESGAUGE as well as a Chatham House Rule discussion with leading in-house corporate governance professionals held in April 2022. Insights for What’s Ahead : - Companies, especially in the S&P 500, are going to face challenges in increasing the diversity of backgrounds, skills, and professional experience on their boards if they continue to elect new directors at the current rate. [...]
- Companies should consider a variety of board refreshment tools to enhance demographic diversity and add relevant skills and experience to the board. [...]
- While companies have considerable flexibility in their approach to board refreshment, expect continued investor attention to this topic.[...]
- Periodic individual director evaluations—which are growing in popularity along with companies’ use of independent facilitators for board evaluations—can promote board diversity and refreshment.
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Institut sur la gouvernance (IGOPP)
August 1, 2022 11:22 AM
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"The carried interest loophole is a stain on the tax code," Ackman said in a tweet. "It does not help small businesses, pension funds, other investors in hedge funds or private equity and everyone in the industry knows it."
Three Arrows, founded in 2012 by Su Zhu and Kyle Davies, was ordered into liquidation last month after creditors sued the hedge fund for failure to repay debts. The hedge fund suffered heavy losses in recent months amid a broad selloff in cryptocurrencies.
Dans un mémoire déposé dans le cadre des consultations menées par la Ville de Montréal sur sa stratégie 2022-2030 pour le centre-ville, la chambre de commerce définit cinq orientations que les autorités municipales devraient privilégier.
Porsche makes a strong case that it shares the attractions of the best luxury brands: a growing market, high margins and economic resilience. But the German sports-car maker also comes with luxury’s common weakness: a powerful controlling shareholder.
Private equity firm CVC Capital and wood panel manufacturer Kronospan have submitted a joint expression of interest to acquire Canadian lumber company West Fraser Timber Co, people familiar with the matter said on Tuesday.
Elon Musk filed a motion Friday opposing Twitter Inc.’s request to expedite a trial over his intention to terminate his $44 billion takeover. Lawyers for Mr. Musk filed papers with the Delaware Chancery Court, their first public response to the lawsuit filed earlier this week by the social-media company seeking to enforce the terms of their merger agreement. The court should reject Twitter’s “unjustifiable request to rush this,” they said in their filing. [...] In Friday’s filing, Mr. Musk’s lawyers said: “The core dispute over false and spam accounts is fundamental to Twitter’s value. It is also extremely fact and expert intensive, requiring substantial time for discovery.” Mr. Musk’s lawyers argued that “it is unnecessary to resolve these weighty considerations on a breakneck schedule” and asked for a trial date on or after Feb. 13 of next year, adding that the debt financing was valid until April 25, 2023.
The regulatory landscape for ESG disclosure by U.S. public companies faces potentially dramatic changes, with the Securities and Exchange Commission (“SEC”) proposing rules that would mandate comprehensive climate change disclosures and integrate key aspects of sustainability reporting with annual reports. [1] Against this backdrop, White & Case surveyed the SEC filings of 50 companies in the Fortune 100 to assess the latest trends in ESG disclosure. For its fourth annual survey of ESG disclosure in SEC filings, [2] the White & Case Public Company Advisory Group reviewed the annual meeting proxy statements and annual reports of 50 companies in the Fortune 100. [3] In these 100 SEC filings, we focused on 12 categories [4] of ESG disclosure in annual reports and proxy statements filed with the SEC in 2020, 2021 and 2022. The key trends and takeaways from our survey are discussed below.
As pressure mounts from stakeholders, sustainability has never been a bigger focus for boards. Investors, lawmakers, regulators, employees, and customers are all focused on sustainability, and often wonder if the board is doing enough to set up the company for long-term success in an increasingly sustainability-minded environment. Around the world—from regulators in Europe to the Securities and Exchange Commission in the US—governments are actively considering new standards for consistent disclosure on sustainability related topics. Our research shows that 73% of boards are discussing sustainability strategy at least once per year, and 65% of directors say their board is making a genuine commitment to sustainability. In recent years, investors have been clear that sustainability and climate risk is the responsibility of the full board. Rather than having a sole “ESG director” or “sustainability director,” expectations are increasing for the entire board to bring a minimum level of sustainability awareness—if not expertise—to their work, using it to identify both risks and new opportunities for value creation.
With soaring inflation rates and the prospect of widespread industrial action across the UK, along with the increasing materiality of human capital management in the minds of investors around the globe, ShareAction’s shareholder resolution at Sainsbury’s July 7 AGM seemed well timed. [...] Shareholder proposals are not a common feature at most UK AGMs. That only served to intensify the spotlight on one of the country’s largest grocery chains – and largest employers, with a significant proportion of staff on low wages and an extensive supply chain of third-party contractors. Though it ultimately failed to secure majority shareholder support, the high-profile nature of the proposal and the considerable AUM of its backers further emphasised the growing importance of ESG issues, and specifically those related to human capital management. It also served as the latest forum for an intensifying debate on how ESG goals should be pursued and how investors should intervene and pressure companies on ESG-related issues, especially in areas that are traditionally the purview of management.
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Institut sur la gouvernance (IGOPP)
August 5, 2022 10:58 AM
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Law professor Lev Menand has a new book out on that strange institution, the Federal Reserve, what it does and how its power and responsibility have grown over time. Menand is an associate professor at Columbia Law School specializing in finance and regulation. Before he joined the law school, he held various roles at the Treasury Department during the Obama administration and was an economist at the Federal Reserve Bank of New York, helping to oversee large lenders. I recently sat down with him to discuss the Fed, the economy, the capital markets, whether we are facing another financial crisis and why he thinks the Fed is bad for our economy and our democracy. This conversation has been edited for length and clarity.
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Institut sur la gouvernance (IGOPP)
August 5, 2022 10:17 AM
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The Competition Bureau’s argument that selling Freedom Mobile would not effectively address competitive concerns about the proposed merger of Rogers and Shaw is “incomprehensible,” Quebecor Inc.’s chief executive officer says. The Commissioner of Competition is attempting to block Rogers Communications Inc.’s $26-billion takeover of Shaw Communications Inc., arguing that the deal would result in poorer service and higher prices for wireless customers. To address those concerns, Rogers has agreed to sell Shaw’s Freedom Mobile, Canada’s fourth-largest carrier, to Quebecor for $2.85-billion. However, the competition watchdog has said separating Freedom from Shaw’s cable network would make it a weaker competitor. The Quebecor president and CEO disagrees.
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Institut sur la gouvernance (IGOPP)
August 5, 2022 10:04 AM
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Old habits die hard — but the last two years have woken up organizations from the comfort of routine. The lesson Responding to change is a practice of the past. Today, anticipatory strategies that harness stakeholder creativity are key in planning for scenarios not in our control. Having said this, creating alternate futures for the organization’s benefit doesn’t occur by happenstance. We identified this need for change last year when we introduced the Manifesto for Future-Fit Organizations, a modern-day revision of the four values and twelves principles of the 20-year-old Agile Manifesto. Future-Fit doesn’t negate Agile, but rather builds on it. As a quick recap, here are the new, elevated values: - Collaborative culture of relationships and inclusion over individuals and interactions
- Innovative systems behind continued learning over working software
- Discovering opportunities together over customer collaboration
- Creating alternate futures through anticipation over responding to change
U.S.-China relations are tense enough to spark concerns of military confrontation after U.S. House Speaker Nancy Pelosi's visit to Taiwan. Pelosi received a vigorous welcome in Taipei on Tuesday and was given strong bipartisan support in Washington, despite the Biden administration's misgivings. But her trip has enraged Beijing and Chinese nationalists — and will complicate already strained ties even after her departure. [...] China insists that Taiwan is part of its country. But Taiwan is self-governing and its leaders reject Beijing's claim of sovereignty, meaning that political control of the island is disputed. Taiwan has been an ally of the U.S. since 1950, when the U.S. was at war with China in Korea. Mao Zedong's communists had just taken power in Beijing in 1949, defeating Chiang Kai-shek's Kuomintang (KMT) nationalists in a civil war. The KMT-led former government of China retreated to the island of Taiwan and cut off contact with the mainland.
“The three most powerful things in business: a kind word, a thoughtful gesture, and passion and enthusiasm for everything you’re doing,” Langone told CNBC’s Jim Cramer in an interview that aired on “Mad Money.”
Should a deal get done, it would be one of a small number of relatively big LBOs to be sealed in recent months as rising interest rates boost the cost of deal financing. NCR has a market value of $4 billion.
Activists are looking to the courts to kill Trump-era rules restricting investors’ environmental, social and governance campaigns, after Biden’s SEC took modest steps to ease standards for submitting shareholder proposals.
The federal Conservatives and industry groups representing Canada’s small businesses and technology sector are calling for changes to the tax system that for years allowed Amazon.com Inc. to book its Canadian retail profits in the U.S., minimizing its exposure to corporate taxation here.
It seems Elliott Management wants Pinterest to move faster and, if it must, break some things. The activist investing firm is now the largest investor in the social-media company, according to a Thursday Wall Street Journal report, having built a stake of more than 9% in recent months. Elliott has historically urged radical change at companies it believes are highly undervalued. In 2020, it pushed for the departure of Twitter’s Jack Dorsey, who resigned as chief executive of the company he co-founded last year. At eBay, Elliott pushed for the spinoff of StubHub and Classifieds—assets that the company ultimately decided to sell off in 2019 and 2020, respectively. Elliott hasn’t said publicly what changes it desires at Pinterest, but Wall Street seems happy to settle for a catalyst of any kind.
Vice Chancellor Laster’s recent opinion in Goldstein v. Denner provides a useful reminder of the importance of documenting board meetings, updates, and communications in formal corporate board documents, as they will likely later be part of the record on any motion to dismiss in a direct or derivative action. This reminder is especially important when a sale of the company or other material determination by the board may be in the company’s future. As is increasingly common, the Goldstein plaintiffs’ claims for breaches of fiduciary duty relating to a sale of the company were preceded by a Section 220 “books and records” demand through which the plaintiffs obtained not only board minutes and presentations to the board, but also certain electronic communications by officers, directors, and the target’s financial advisor relating to the sale process.
The SEC has posted its Spring 2022 Reg-Flex agenda and it’s crammed with pending and new rulemakings—and they’re all going to be proposed or adopted in October! (Ok, admittedly, that’s an exaggeration, but not much of one.) Here is the short-term agenda and here is the long-term agenda. According to SEC Chair Gary Gensler, the “U.S. is blessed with the largest, most sophisticated, and most innovative capital markets in the world….But we cannot take that for granted.
Old habits die hard — but the last two years have woken up organizations from the comfort of routine. The lesson?
Responding to change is a practice of the past. Today, anticipatory strategies that harness stakeholder creativity are
key in planning for scenarios not in our control. Having said this, creating alternate futures for the organization’s benefit doesn’t occur by happenstance. [...] As a quick recap, here are the new, elevated values:”
#1.Collaborative culture of relationships and inclusion over individuals and interactions
#2. Innovative systems behind continued learning over working software
#3. Discovering opportunities together over customer collaboration
#4. Creating alternate futures through anticipation over responding to change
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