Across the Board
US Government Shuts Down
How it affects key economic data publishing
“The U.S. government shut down much of its operations on Wednesday after Republicans and Democrats failed to reach an agreement to extend funding past a midnight deadline, a closure that will shut off the flow of key economic data at a moment of uncertainty among policymakers and investors about the health of the U.S. job market, the trajectory of inflation and the strength of consumer spending and business investment.” REUTERS
The Company Founders Who Think They Need Not One but Two Successors
After Netflix and Oracle, Spotify becomes the latest entrepreneur-run company to hand the reins to co-CEOs
“Finally convinced it is time to step aside, company founders often decide it takes two people to fill their big shoes—despite the mixed record of companies led by co-CEOs. Spotify’s Daniel Ek is the latest entrepreneur to be succeeded by a pair of chief executives. The music streaming giant announced Tuesday that co-presidents Alex Norström and Gustav Söderström will become its co-CEOs on Jan. 1. Oracle, founded by Larry Ellison, just announced its second pair of co-CEOs in 11 years. Comcast, too, picked a co-CEO to join longtime leader Brian Roberts, whose father founded the media company in 1963. Two heads are better than one, some boards reason, because they can bring complementary skills to the demanding role. The approach remains rare but has been particularly popular among entrepreneurs passing the baton…. Yet the arrangement often sets up a power struggle from the start, and many companies end up abandoning it before long.” WALL STREET JOURNAL
Building Resilience from the Top Down
In a world defined by disruption, high-performing organizations are those where directors and executives collaborate more fluidly, frequently, and strategically
“Across global markets, organizations continue to face challenges stemming from uncertainty, rapid change, and an array of risks…. A recent Deloitte analysis shows that many Fortune 500 organizations have added new C-suite roles, such as chief legal officer, chief transformation officer, and chief communications officer, to help ensure that the C-suite has the right skills and capabilities to capture opportunities and effectively manage challenges and risks. In this environment, it is perhaps no surprise that CEO tenure has reached its lowest point since Russell Reynolds began tracking it in 2018—a shift the firm attributes to ‘evolving role demands.’ The takeaway from these trends? Many CEOs—and their top management teams—may be seeking a different kind of engagement model with their boards, one that is more reflective of effective partnering and could offer challenge and support in equal measure.” DELOITTE INSIGHTS
The Modern Board Acts in Motion, Not in Meetings
When strategy must constantly evolve, boards can’t afford to wait for formal strategy sessions that occur once or twice a year
“The world is moving at breakneck speed, and a new study by Corporate Board Member and the EY Americas Center for Board Matters reveals just how dramatically this pace of change is reshaping corporate governance. In new research conducted earlier this year among nearly 200 public company board members, nearly three-quarters of directors say their corporate strategy is in constant flux, with six out of 10 saying they expect their carefully crafted plans to need complete overhaul within just 12 to 18 months…. The research reveals a changing dynamic in boardroom decision-making. While boards and management teams report strong alignment on current risks—with 87 percent of directors believing they see eye-to-eye with management on risk assessment—this consensus may be masking a more troubling issue: the potential for groupthink in an era when diverse perspectives are more critical than ever.” CORPORATE BOARD MEMBER
Board Diversity Stalls as White Men Reclaim the Majority
For the first time since 2017, white men make up most new S&P 500 board appointments
“Interviews with directors and recruiters make clear that boards are seeking candidates with experience as chief executive officers to help navigate economic and political turmoil, particularly tariffs. And because many of those executives began their careers decades ago, when leadership was less diverse, those being picked now are disproportionately White and male…. At the same time, recruiters say, efforts to broaden representation has slipped down boards’ priority lists amid the Trump administration’s backlash against diversity, equity and inclusion practices…. Through the pandemic and after, boards sought to bolster diversity and build their digital and human-resources expertise, areas with a broader pool of potential directors. Many of those hires now lead and sit on the powerful committees that decide who gets new board seats. They’re now asking recruiters to find leaders who have run companies or big business units, telling them that other considerations matter less.” BLOOMBERG
EA Goes Private in a Gaming Megadeal
A $55B leveraged buyout puts iconic franchises in private hands, illustrating how deep capital is reshaping entertainment, strategy, and boardroom priorities
“Videogame giant Electronic Arts will be taken private in a record-breaking $55 billion leveraged buyout by a consortium consisting of private equity firm Silver Lake, Saudi Arabia's Public Investment Fund and Jared Kushner's Affinity Partners, the company said Monday…. The take-private offer comes at a crucial time for EA, which is banking heavily on its core sports portfolio and action shooter intellectual property to weather a sluggish videogame industry as gamers get picky with spending.” REUTERS
Amazon’s Prime Tactics Trigger Record FTC Penalty
$2.5B later, the case serves as a warning shot for digital giants, and a call for stronger boardroom oversight of consumer-facing strategies
“Amazon agreed to pay $2.5 billion to settle Federal Trade Commission allegations that it duped customers into signing up for its signature Prime service and made it very difficult for them to cancel. The e-commerce giant will pay a $1 billion civil penalty, the largest in FTC history, and create a $1.5 billion fund to pay back to consumers, according to court documents. It will also be required on its Prime interface to include a simple way to cancel…. Amazon’s Prime membership, the largest paid subscription program in the world with at least 200 million users, has helped the company become an integral part of consumers’ shopping habits.” WALL STREET JOURNAL
Where Were the Directors? Investors Want More Than Silence
From Boeing to Meta, investors are demanding clearer answers on how directors respond, or fail to respond, when crisis hits
“Corporate scandals have always existed and many stem from weak corporate governance, often caused by a lack of communication, insufficient internal controls or a very lax attitude towards potential problems. In 2024, the US administration criticized Boeing’s board for failing to adequately supervise the safety procedures of its aircraft, following several accidents involving its 737 Max model that resulted in numerous deaths…. Also in 2024, Sam Bankman-Fried, founder and CEO of FTX, one of the world’s leading cryptocurrency platforms, was sentenced to 25 years in prison for defrauding his investors. In July of this year, the lawsuit filed by a group of small shareholders against the members of the board of directors of Meta, parent of Facebook, reached the oral trial stage before a settlement was reached. They had alleged that the directors were very lax in their supervisory duties…. A recurring question in these cases is around the extent to which the board is responsible for management decisions that may originate at levels of the company far removed from the board.” GOVERNANCE INTELLIGENCE
The Forecast on Quarterly Reporting
With EU and UK models showing little disruption, pressure is mounting in the U.S. to reconsider one of its longest-standing corporate requirements
“Every few years, the question arises as to whether quarterly reporting is the optimal timeframe for U.S. public companies. Now, with both President Donald Trump and Securities and Exchange Commission (SEC) Chairman Paul Atkins as active proponents of ending quarterly SEC reporting, regulatory reform seems more likely than ever before. Thanks to experimentation with reporting frequency in the European Union (EU) and the United Kingdom (UK), it is possible to make a few observations about potential reforms and a few predictions as to how regulatory change would affect financial reporting in practice. Overall, reducing reporting from a quarterly to a semi-annual schedule is likely to have less effect than either its critics fear or its proponents hope, as demonstrated by the EU and UK experience.” HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE
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