Across the Board
Boards at the Edge: Innovation Demands, Trust Expectations
Directors are increasingly called upon to encourage transformation without losing the confidence of regulators, investors, or the public
“Perhaps more than at any time in history, boards are being forced to balance innovation and trust. The pressure for this dual mandate arises from intensifying scrutiny, ranging from consumer scrutiny, regulatory oversight, and social media spotlighting, to investor expectations and rapid technological disruption. Against this backdrop, boards must balance daring leaps forward with the confidence that they’re not exposing their organizations to reputational, financial, or ethical harm.” FAST COMPANY
AI Will Reshape the Workforce, Says Amazon CEO
Andy Jassy says AI developments in the next few years will affect the number and types of jobs human workers have
“Chief Executive Andy Jassy, in a note to employees Tuesday, called generative artificial intelligence a once-in-a-lifetime technological change that is already altering how Amazon deals with consumers and other businesses and how it conducts its own operations…. Companies ranging from retail to pharmaceuticals are using AI to perform an increasing number of functions. Executives say the technology is creating the need for new kinds of roles. At the same time, they have begun drawing up plans to consolidate positions and started acknowledging publicly that it will lead to cutting some jobs…. Williams-Sonoma CEO Laura Alber told investors last month that the company planned to stay ‘lean on head count’ by using AI tools to drive productivity. Shopify executives, meanwhile, recently mandated that teams first assess how they could meet their goals with AI before bringing on additional employees to the company. Bank of America Chief Executive Brian Moynihan has said he believes the banking industry will employ fewer people over time as AI affects how banks process payments and manage client finances. About 41% of employers said they would downsize their workforce due to AI, a recent World Economic Forum survey found.” WALL STREET JOURNAL
Microsoft Joins The Trend: AI Displacing Employees
Investment in AI continues, focusing on performance and agility for both its technology and its people
“Microsoft is planning to lay off several thousand employees in the next few weeks, looking to thin out its ranks while continuing its costly push into artificial intelligence. The reduction of thousands of jobs will affect its sales department and other teams, people familiar with the matter said. The number of cuts isn’t yet final, and they are planned for around the beginning of Microsoft’s new fiscal year, which starts in July, they said.” WALL STREET JOURNAL
Shareholder Activism in 2025: Quieter Tactics, Same Pressure
In 2025, activists and companies are favoring negotiated outcomes over proxy fights—without backing down on demands for change
“Despite global economic uncertainty, a challenging M&A environment and an evolving regulatory landscape, shareholder activists remained relatively busy during the first half of 2025. The sustained level of overall activist activity reflects both the variety and versatility of established activists, as well as the continued willingness of other investors to employ the activist toolkit to unlock shareholder value. Talk of an M&A boom (and an expected increase of M&A-related activism) early this year was quickly overtaken by talk of tariff doom. Board and management teams that fail to contend with today’s economic challenges and uncertainties—especially compared to similarly situated peers—risk becoming prime targets for activists once the impact of tariffs manifests in their earnings releases.” HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE
Victoria’s Secret Under Fire as Shares Tumble
Activist seeks board changes and end to poison pill plan as Victoria's Secret shares have dropped 55% so far this year
“Activist investor Barington Capital Group plans to mount a push to change Victoria's Secret's board of directors and end a recently adopted shareholder's rights plan, according to a person familiar with the situation. The New York-based hedge fund, which owns more than 1% of the company, believes Victoria's Secret has underperformed its competitors and lost value since its spin-off from former parent company L Brands in 2021… Barington wants the company to replace most or all of its board and end the ‘poison pill’ plan that it adopted in May to protect it from hostile takeovers. It also believes the retailer should focus on core brands and initiatives, like bras and the Angels campaign, and accelerate growth in digital and international markets, the source said. Barington believes the company's Chief Executive Hillary Super, who took over in September 2024, has limited public company experience, and that the rest of the board lacks the necessary experience to revitalize the iconic brand.” REUTERS
Minority Shareholder Pushes for Board Seat at Swatch
Fund manager tried to join Swatch Group’s board to represent minority shareholders
“When American fund manager Steven Wood set his sights on the storied Swiss watchmaker Swatch Group, he tried a suitably stylish opening gambit. He sent Chief Executive Nick Hayek cigars; a favorite book, ‘The Luxury Strategy’… and a handwritten note laying out opportunities he saw for Swatch’s luxury brands to recapture market share…. Wood, who runs investment firm GreenWood Investors, reached out to Nick Hayek, the founder’s son, in September. The next month, the New York-based investor secured a meeting with the CEO and the finance chief at Swatch’s timber-framed headquarters in Biel, Switzerland, where they talked for more than two hours over coffee…. But the courtship abruptly ended in March, when Wood submitted himself as a board candidate to represent Swatch’s minority shareholders. The CEO stopped responding to Wood’s notes, and his sister, Swatch Chairwoman Nayla Hayek, responded to a letter but declined to meet…. Wood started GreenWood Investors in 2010 and has taken what he calls a ‘constructivist’ approach of being friendly and engaged, rather than ‘activist’ and demanding." WALL STREET JOURNAL
Where Do Corporate Leaders Stand on DEI? On a Knife’s Edge
Even though a political football, DEI still matters to most. How they talk about it is another subject entirely
“DEI’s apparent eclipse is clear from the policies of America’s biggest brands. The Walt Disney Company, McDonald’s Corporation, Ford and Walmart are just four of the corporate giants to soften their diversity stances for 2025, with other firms moving in the same direction…. These high-level changes also can be traced across some major investors and proxy advisors. A case in point is BlackRock. In December, the money manager tweaked its voting guidelines, removing recommendations that boards should hit diversity levels of 30 percent…. Beyond these headline changes, it’s increasingly apparent that a decline in DEI could have a deep practical impact around how firms relate to proxies. Consider, for instance, the fraught question of disclosure. In 2021, lobbying from issuers and investors led to a change at Nasdaq, whereby listed companies were expected to disclose the racial and ethnic makeup of their boards. But with the rule slapped down in court, corporate leaders may now be under less pressure from shareholders.” CORPORATE BOARD MEMBER
With All of this Volatility, CEO Succession Planning Really is a Must Do
With CEO turnover accelerating and leadership trust eroding, succession planning is no longer optional—it’s a core mandate
“Succession planning is having a moment. From Warren Buffet at Berkshire Hathaway to Jamie Dimon at JPMorgan Chase, CEO transitions are front-page news. Yet these carefully orchestrated announcements mask an undeniable reality: few organizations sufficiently prioritize succession planning, a serious oversight with rising C-Suite churn…. These exits often have massive, negative organizational impacts, especially when unplanned or improperly managed. They can foster misalignment at the executive level, limit performance and outcomes and erode trust and engagement among team members. The shock waves are especially damaging to organizations with growth mandates, like those backed by private equity firms, as well as industries that are heavily dependent on their people, like healthcare. While not all CEO transitions can be anticipated, today’s top leaders are experiencing high levels of burnout, with many exploring professional alternatives or retirement.” CORPORATE BOARD MEMBER
|
|
