Across the Board
Behind Bloomberg’s Decision to Refresh the Entire Board
Michael Bloomberg: “It’s time to build on what they did and get the next generation into place”
“Michael Bloomberg wasn’t known for board refreshments until last week—when he fired every single director…Bloomberg’s new board of directors will be headed by Mark Carney, the former governor of the Bank of England, but no other incoming members were mentioned…Corporate governance experts say Bloomberg’s move to ax the entire board is nearly unprecedented. Sure, Elon Musk fired the entire Twitter board when he purchased the social media platform (he became the sole director), but he was taking the firm private at the time. And while it’s possible that CEOs or founders of small private companies might take dramatic measures to rebuild a board, staggered refreshments are more common, especially at a company the size of Bloomberg, a titan of the finance industry with revenues of $12 billion a year, according to the Financial Times.” FORTUNE
Leonard Lauder to Step Down from Estée Lauder Board
Leonard Lauder has designated his son Gary Lauder to serve on the board
"Estée Lauder said on Thursday that its chairman emeritus Leonard Lauder will step down from its board of directors in November. The 90-year-old billionaire will retain the title of chairman emeritus. Leonard Lauder is the son of Estée Lauder and Joseph Lauder, who founded the company in 1946. During his reign as chief executive, Lauder took the company public on the New York Stock Exchange in 1996 and oversaw the acquisition of major cosmetic brands including MAC Cosmetics and Bobbi Brown.” SEEKING ALPHA
The Fed Ramps Up Demands on Regional Banks
Regulators warn banks to shore up liquidity planning in the wake of recent failures
“The Federal Reserve has issued a slew of private warnings to lenders with assets of $100 billion to $250 billion, including Citizens Financial Group Inc., Fifth Third Bancorp and M&T Bank Corp., according to people with knowledge of the matter. The wide-ranging notices have touched on everything from lenders’ capital and liquidity to their technology and compliance, the people said, asking not to be identified discussing confidential supervisory information. The onslaught of such warnings — known as matters requiring attention and matters requiring immediate attention, or MRAs and MRIAs — comes as examiners look for other signs of stress in a system already strained by the collapse of First Republic Bank, Silicon Valley Bank and Signature Bank this year. It’s part of a wider increase in scrutiny impacting banks of all sizes after Michael Barr, the Fed’s vice chair for supervision, vowed to “improve the speed, force and agility” of oversight earlier this year.” BLOOMBERG
New EY Report: Corporate Boards are Expanding Cybersecurity Oversight
Almost half of the companies reported at least annually to the board on cybersecurity
“EY’s sixth annual study is based on proxy statements and annual reports of 75 of the top Fortune 100 companies, from fiscal year 2018 through May 31. The research shows just how much cybersecurity has evolved as a focus of board oversight in recent years, as cybersecurity risk has become a much more prevalent concern for shareholders, customers and government regulators. The report indicates companies are streamlining the process of disclosing cyber risk information to the board. For example, 57% of Fortune 100 companies have designated at least one person to report these issues to the board, with most designating either a CISO or CIO. In 2018 only 23% of Fortune 100 companies made such a designation." CYBERSECURITY DIVE
The Path from CISO to Board Director
Cyber experience must match certain board qualifications
“Everyone even peripherally involved with corporate governance, compliance, or risk management knows that corporate boards need more CISOs to help them navigate today’s cyber-saturated world. Even better, plenty of CISOs are at least open to the idea of serving on boards. That’s good news, but it raises an important question: Just what type of experience should a CISO have to be a strong candidate for a board seat? It’s not enough to put “cyber experience” at the top of your LinkedIn profile and then wait for the recruiters to call. CISOs need specific types of experience, both technical and operational, to gain the perspective and judgment that boards want to see. Only then can you be a credible candidate for board service.” JD SUPRA
Episode: Board Oversight and Monitoring of AI Risks
Podcast discusses the urgent need for corporate boards to address AI
“As companies rapidly adopt artificial intelligence (AI), it becomes paramount to have robust governance frameworks in place. Not only can AI bring about vast business benefits, but it also carries significant risks—such as spreading disinformation, racial discrimination, and potential privacy invasions. In this episode of Corruption, Crime and Compliance, Michael Volkov dives deep into the urgent need for corporate boards to monitor, address, and incorporate AI into their compliance programs, and the many facets that this entails.” JD SUPRA
3M Agrees to $6B Settlement in Earplug Suit
Settlement will be paid over a multi-year span
“3M said it would pay $6 billion to resolve claims that its earplugs caused hearing loss among veterans, putting a long-awaited price tag on a large chunk of the company’s legal troubles…3M reached an agreement with plaintiffs attorneys to pay $5 billion in cash and $1 billion in stock between 2023 and 2029 to settle the allegations, confirming an earlier report from The Wall Street Journal. The company will take charge of $4.2 billion in the third quarter related to the settlement…The earplug litigation has become the largest single mass tort in U.S. history, with more claims than any one company has faced for earlier mass litigation including asbestos exposure, opioid sales or wildfires…RBC Capital Markets analyst Deane Dray said in a note to investors that the projected amount was on the low end of expectations, though higher than the $1 billion that 3M said it had reserved to pay claims.” WALL STREET JOURNAL
Chanel’s New CEO is Reinventing the Company
As the former CHRO of Unilever, Leena Nair was an unexpected hire
“Nair, 54, was not an obvious choice to lead Chanel. Before assuming the role in January 2022, she’d been chief human resources officer at Unilever, a $132 billion behemoth that counts Dove soap, Ben & Jerry’s ice cream and Hellmann’s mayonnaise among its products…And though she was a public face of Unilever at conferences like Davos and HerRising, Nair had never held a CEO role…Nair was tapped by Chanel’s board and its co-owner and chairman, Alain Wertheimer, who had been serving as global CEO for the brand his grandfather, Pierre, first backed in 1924. In the ’80s, when Chanel had atrophied into little more than a drugstore perfume purveyor, it was Alain who persuaded designer Karl Lagerfeld to join the company…Nair’s dominion extends beyond clothing, and she has overseen an array of launches as Chanel has invested heavily in retail. A major new boutique in Tokyo’s Ginza neighborhood, which opened last October, exemplifies the brand’s desire to focus on standalone stores selling watches and fine jewelry. An eco-focused cosmetic, beauty and fragrance line, N°1 de Chanel, was introduced globally last year. The company has also expanded its private salons designated for top clients.” WALL STREET JOURNAL
