Director's Domain June 13, 2022
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Where business meets politics. Activist shareholders are widening their scope, from recent proposals targeting topics like diversity, pay equity, and climate change, to bring one of the most contentious political issues directly into the corporate sphere: At least three shareholder proposals are pressing major retailers to disclose the risks and costs associated with restricted access to abortion for their employees. Meanwhile, a recent study shows that women make up a quarter of executives at S&P 500 companies yet hold only 1% of company share value or about $9 billion worth, compared to the $770 billion worth of company shares held by their male counterparts. Starbucks announces its CEO search will include no internal candidates. And observers suggest that boards will need to stay focused on supply chain issues as they help guide companies through challenging times ahead.
BOARDS ADD VALUE: At Boardspan, we spend a lot of time talking to board members about the ways they add value and the many challenges they’re facing. Check out this?two-minute video?that highlights what we’ve learned.
In the Spotlight
Shareholders Press Corporations, Asset Managers to Address Abortion Rights
“Shareholders have placed abortion-rights proposals on the proxies at three big retailers this spring: Walmart; Lowe’s; and TJX, the owner of off-price chains including TJ Maxx…. That development is pressuring asset managers such as BlackRock Vanguard Group and State Street…to confront the issue because they hold significant stakes in those and other companies on behalf of millions of other investors…. Activist investors submitted the shareholder proposals in December. Broadly, they ask each company to compile a report evaluating the risks and costs of restricted reproductive rights, including on employee hiring and retention…”?WALL STREET JOURNAL
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Across the Board
Women Execs at S&P 500 Companies Hold Just 1% of Share Value
“Women account for about a quarter of the top executives at S&P 500 companies and they only control about 1% of the value of shares held among their fellow corporate leaders, new research shows. The disparity means male executives held about $770 billion worth of shares in S&P 500 companies in 2020, compared with about $9 billion for female executives, said Andreas Hoepner, a professor of operational risk, banking and finance at the Smurfit Graduate School of Business at the University of Dublin. The study, conducted with Swedish gender data company ExecuShe, found the ratio was skewed even after removing company founders and outliers like Tesla Chief Executive Officer Elon Musk, the wealthiest executive in the index, he said.”?BLOOMBERG
Opinion: That Starbucks Doesn’t Have A Single Internal Candidate for CEO Is A Board Failure
“On Monday, Howard Schultz, Starbucks' chairman (and former U.S. presidential candidate), told The Wall Street Journal that the company wasn't considering any internal candidates for its next CEO appointment. Think about that for a second. Of the many thousands of managers and executives in the company -- and the tens of millions of dollars the company proudly spends on leadership development -- the Starbucks board has determined and publicly announced that not one single person in the company is capable of being promoted internally to fill the CEO spot. Leadership development is the opposite side of the same succession planning coin. Starbucks has failed on both sides. That's a major, board-level meltdown. Heads should roll….”?INC
Why Supply Chain Should Stay at the Top of Your Board Agenda
“Boards have really got to be hyper focused on providing the right level of governance—challenging management and giving guidance to management—around what they’re doing regarding the supply chain. If Covid-19 showed us anything, it’s that supply chain resiliency and supply chain sustainability are key… And the role of the board is to understand what is the company’s strategy around its supply chain network. What is your level of transparency? How can management make things transparent enough, so directors know what you’re monitoring and how you’re ensuring that you’ve got the right level of resiliency?”?CHIEF EXECUTIVE?
Is Your Board Prepared for the SEC’s Climate Proposal?
“The [SEC climate disclosure] proposal raises the bar with respect to board governance and has substantial implications for boards in their oversight of climate-related risks and, if applicable, climate-related opportunities…. First and foremost a board must decide, if it has not done so already, whether the full board or a particular board committee is responsible for the oversight of climate-related risks…. The board’s role in setting targets or goals related to climate-change matters and its oversight of this area are two additional disclosure requirements that will take some thought, as well as time, to be appropriately included in materials… so that they can form the basis for the disclosure that will be included in the company’s SEC filings.”?CORPORATE SECRETARY
Hasbro Shakes Off Activist Challenge, Re-elects 13 Directors
“Hasbro has fended off a board challenge from an activist investor that wanted to shake up its board and spin off the toymaker’s lucrative division that includes Dungeons & Dragons. On Wednesday, the Rhode Isand-based company said its shareholders voted to reelect its 13 directors by a ‘substantial margin,’ according to preliminary vote tallies.”?CNBC
领英推荐
Icahn Drops Animal Welfare Fight Against Kroger
“Carl Icahn has decided to drop his proxy fight against Kroger over the treatment of pregnant pigs, the billionaire investor said on Monday, days after losing a similar battle at McDonald's. Icahn is withdrawing his nominees to Kroger's board, he said in a statement to shareholders of both the companies. The activist investor nominated two directors to the supermarket chain's board in March, a month after taking on McDonald's….”?REUTERS
From the Boardspan Library
Board Members: Are You Thinking Like an Activist Investor?
“The growing drumbeat of investor activism isn’t just a trend; it’s a fundamental change in relationship between shareholders and companies. The past decade has seen activist investors pursuing more than 2,000 campaigns to redirect business strategies, activities, and resources, about 40 percent of which involved some form of merger or acquisition. In many cases, the activists actually forced assets into play….Activists increasingly are coming prepared with ideas for growing shareholder value and improving business performance….Nevertheless, board members shouldn’t wait for activists to make moves….The board and management should work together to understand activists’ interests and motivations, recognize factors that can cause them to take action, and respond swiftly and decisively if an inquiry surfaces….”?DELOITTE via BOARDSPAN
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Seat at the Table
Boardspan congratulates:
Tiffany Daniele, CFO of Union Square Hospitality Group, on her appointment to the board of makeup and skincare company e.l.f. Cosmetics…
…?David Wheadon, MD, former SVP of global regulatory affairs, patient safety & quality assurance at AstraZeneca Pharmaceuticals, on his appointment to the board of biotech firm ChemoCentryx
Boardspan is delighted to have advised e.l.f. Cosmetics and ChemoCentryx on these placements and we offer our congratulations to all recent placements:
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About Boardspan
Learn more about?Boardspan?and schedule a complimentary strategy call with our team.
Boardspan?is the leading provider of digital governance solutions for boards across all sectors. Our cloud-based assessments, dashboards, benchmarking analytics, and governance education programs complement our board search and advisory services to deliver a holistic approach to governance. Boards of all sizes and stages rely on Boardspan to deliver analytics, insights, and outcomes that improve their effectiveness and performance. Clients include KKR, The Kellogg Foundation, Ingersoll Rand, Farfetch, McAfee, Beyond Meat, Box, e.l.f. Beauty, Satellite Healthcare and the U.S. Olympic & Paralympic Committee.