Shareholders & Activism

Panelists on recent webinar encourage companies to simplify plans, explain their thinking and avoid too many year-on-year changes Investors remain focused on ensuring executive compensation plans deliver outcomes that align the experience of management with other stakeholders, according to panelists on a recent Governance Intelligence and IR Magazine webinar, held in partnership with Alliance Advisors. ‘We’re looking at the experiential aspects of the comp plan,’ said Paul Schneider, director of corporate governance at Ontario Teachers’ Pension Plan, which manages around C$250 bn ($184 bn) in assets. ‘How does the executive compensation plan align with the shareholder experience? That really came…

SEC denies no-action request to omit the measure Verizon Communications shareholders appear set to vote on a shareholder resolution seeking information about any ways the company’s political spending does not align with its public positions after the SEC denied a request for the go-ahead to exclude the proposal. The proposal filed by As You Sow asks that Verizon’s board report each year on the company’s ‘political and electioneering expenditures, identifying and analyzing incongruence between such expenditures and the company’s operational and strategic needs and its stated values and policies. The report should state whether Verizon has made, or plans to…

Vote on union group’s proposal scheduled for April 30 AGM Wells Fargo & Company shareholders will vote next month on a proposal seeking a review of the bank’s respect for key labor rights. This comes amid concerns from unions and others about some US companies’ responses to an uptick in efforts to unionize in recent years. The resolution, filed by Segal Marco Advisors on behalf of the AFL-CIO Equity Index Funds, asks Wells Fargo’s board to ‘commission and oversee an independent, third-party assessment of [the company’s] respect for the internationally recognized human rights of freedom of association and collective bargaining.’…

This week’s governance, compliance and risk-management stories from around the web Deirdre Stanley, executive vice president and general counsel of The Estée Lauder Companies (ELC), has decided to step down from her role to ‘embark on a new chapter’, according to the firm. Stanley will continue in her position until April 2, 2024, and her successor will be announced at a later date, the New York-based company says. She did not respond immediately to a request for comment. Stanley joined ELC in her current position in October 2019. She is a member of the company’s executive leadership team and advises…

Quaker group concerned about products ending up being used in Russia’s invasion of Ukraine Texas Instruments (TI) is set to face a vote on a shareholder resolution seeking information about possible misuse of its products including in Russia’s invasion of Ukraine. The SEC has declined to give TI the green light to omit the measure from its upcoming AGM. Specifically, the proposal brought by Friends Fiduciary Corporation (FFC) asks that TI’s board ‘commission an independent third-party report… on [the company’s] due diligence process to determine whether customers’ misuse of its products expose the company to human rights and other material…

A passive approach to governance data can be a disadvantage, says Dr William Cox Why do investors focus on governance? Well, numerous studies have shown a positive connection between good governance and higher stock prices as well as easier and cheaper access to capital. But there are plenty of cases where supposedly ‘good’ governance turns out to be a rotten apple. One reason can be that checking the boxes on governance structures can easily disguise dangerous weaknesses in actual governance and management. This passive approach did not prevent governance meltdowns such as Enron, WorldCom, Lehman Brothers and, recently, Signa. They…

Resolution includes call for board oversight of human rights due diligence Pfizer is set to face a shareholder vote this proxy season on a proposal regarding human rights after it unsuccessfully sought SEC no-action relief to omit the resolution. The measure urges Pfizer’s board ‘to oversee conduct of human rights due diligence (HRDD) to produce a human rights impact assessment covering Pfizer’s operations, activities, business relationships and products… The [assessment] should describe actual and potential adverse human rights impacts identified in the course of HRDD, identify rightsholders that were consulted and discuss whether and how the results of the [assessment]…

Listed companies spend a lot on social programs, but what do shareholders care about? William Cox discusses Public companies are under increasing scrutiny over their ESG claims. Around the world, investors, regulators, politicians, campaign groups, protesters and a host of sometimes unlikely stakeholders are voicing their concerns over the climate crisis, human rights, supply-chain management and more. As the world passes a stark milestone – with global warming exceeding 1.5ºC across an entire year for the first time, according to the EU’s climate service – Governance Intelligence sister publication IR Magazine hears from Glenn Hurowitz, CEO of Mighty Earth, about…

World’s largest sovereign wealth fund steps up net-zero pursuit Norges Bank Investment Management (NBIM) has stepped up its climate plans and expects its portfolio companies to follow suit as it continues to divest from more companies carrying high environmental and social risks. Last year the sovereign wealth fund divested from 86 companies that it says pose ESG risks and identified companies with heightened risks across a variety of ESG topics, including potential violations of human and labor rights, insufficient risk management related to corruption and business models highly exposed to thermal coal. In total, NBIM has made 526 divestment decisions…

Resolution expresses concern about ‘systemic risks stemming from growing income inequality’ Amazon.com has asked the SEC for the green light to omit a shareholder proposal asking the company to produce a ‘living wage report’, arguing that it deals with ordinary business operations and seeks to micromanage the online retailer. The resolution, filed by Zevin Asset Management, requests Amazon’s board oversee the preparation of a ‘living wage report to provide investors with information needed to assess the extent to which the company is complying with international human rights standards and assessing systemic risks stemming from growing income inequality.’ The proposal asks…