Across the Board
Half of All Firms Say Job Cuts Are Coming…
“Best Buy, Ford Motor, HBO Max, Peloton, Shopify, Re/Max, Walmart and Wayfair are among the firms that announced layoffs in recent weeks. Meanwhile, 50% of firms are anticipating a reduction in overall headcount, while 52% foresee instituting a hiring freeze and 44% rescinding job offers, according to a PwC survey of 722 U.S. executives fielded in early August.” CNBC
…As Snap Cuts 20% of Staff…
“Snap is reportedly getting ready to make a major round of layoffs, as Snapchat advertising sales have hit turbulence. The social messaging and media company is set to cut 20% of its workforce, with layoffs set to begin Wednesday… As of the end of June 2022, Snap had 6,446 full-time employees, an increase of 38% year over year…” VARIETY
...And Bed Bath & Beyond Turnaround Strategy Brings 150 Store Closures, Layoffs
“Bed Bath & Beyond on Wednesday announced swift and significant steps it is taking to try to revive its struggling business, including layoffs, store closures and a shake-up of the brands on its shelves. On a call with investors, the New Jersey-based retailer laid out details of its latest turnaround push. It said it has started closing about 150 of its ‘lower producing’ namesake stores. It will also slash costs by shrinking head count by about 20% across the corporate and supply chain workforce… Its business has already taken many blows. The company said it lost hundreds of millions of dollars in sales because it didn't have items in stock. It was publicly criticized by activist investor Ryan Cohen, who later sold off his entire stake in the company. Former CEO Mark Tritton, who was chosen to carve out a successful strategy, was ousted by the board in June.” CNBC
Union Membership On the Rise Again...
"The number of Americans who belong to labor unions had been dropping for decades. But suddenly, in the last year or so, the winds have changed. Unionization efforts are underway at tech companies like Apple and Google; media organizations like The New York Times and Condé Nast; and among grad students, delivery drivers and baristas. Since December, when a Starbucks in Buffalo was the first to vote to unionize, workers at more than 200 Starbucks stores have followed suit… And then, last April, there was news that stunned the business world, about America's second-largest employer: JFK8, a massive Amazon warehouse on Staten Island that employs 8,300 people, voted to unionize” CBS NEWS
...With First Chipotle Location Voting In Favor This Week
“Workers at a Chipotle Mexican Grill in Lansing, Mich., voted to unionize on Thursday, establishing the first union at the fast food chain nationwide…The election follows a string of first-time union victories led by Gen Z and millennial workers at high-profile companies such as Amazon, Starbucks, Trader Joe’s, and Apple that have long evaded unionization. It also marks a milestone for the low-wage fast food industry, where unions have struggled for decades to gain a foothold because of the sheer number of locations, the franchising model, and high turnover.” THE WASHINGTON POST
Musk's Legal Team Seeks Delay in Twitter Trial...
“Elon Musk's legal team is seeking to delay the trial with Twitter over their $44 billion acquisition deal by a month in light of the whistleblower disclosure alleging that the company has serious security vulnerabilities. The case is currently set to go to trial in the Delaware Chancery Court for five days starting October 17, after a judge ruled that the uncertainty from a dragged-out litigation process threatened ‘irreparable harm’ to Twitter…Musk's team proposed a new schedule with the trial taking place sometime in November, depending on the court's availability... The motion to push back the trial comes after Musk on Monday sent a letter to Twitter citing Zatko's disclosure as additional justification for terminating the acquisition. The letter claims that if the allegations are true, Twitter breached its side of the deal. In their earlier move to scrap the deal, Musk and his team accused the company of violating the agreement by lying about the number of bots on its platform and failing to turn over information Musk says he needs to evaluate the issue.” CNN BUSINESS
…As Both Sides Subpoena Who’s Who Of Silicon Valley Elite
“Jack Dorsey, a founder of Twitter, got a subpoena. So did Marc Andreessen, a prominent venture capitalist. Larry Ellison, Oracle’s chairman, and the investors David Sacks and Joe Lonsdale received them, too. They were all summoned to share what they know about the rancorous, knock-down, drag-out tech spectacle of the year: the fight between Twitter and Elon Musk, the world’s richest man….So far, lawyers for Twitter and Mr. Musk have issued more than 100 subpoenas in the battle, targeting big-name banks (Goldman Sachs, Morgan Stanley), high-profile investors (Andreessen Horowitz, Sequoia), well-known advisers, prominent companies that employ Twitter’s board members (Salesforce, Mastercard) and members of Mr. Musk’s entourage. Even for a high-stakes corporate lawsuit, the deluge of paperwork is remarkable, legal experts said. The October trial puts the case on a breakneck timeline, compressing legal work that might normally stretch on for years into just three months.” NEW YORK TIMES
Mary Dillon Steps In as CEO of Footlocker
“The chief executive who oversaw the rapid expansion of Ulta Beauty will take over as CEO of Foot Locker during a period of significant transition for the chain. Mary Dillon, one of only 31 women leading a S&P 500 company before stepping down as the top executive at Ulta early last year, will take over at Foot Locker for Richard Johnson, who retires next month…Dillon takes control of the company next month with Foot Locker relying less on sales at malls, where foot traffic has plummeted, and moving away from one of its most dominant suppliers, Nike. Nike recently shifted aggressively to direct sales to customers. Johnson, who has led the company since 2014, will continue as the board’s executive chairman through 2023.” YAHOO
Women Are Gaining Representation on S&P 500 Boards
"Coca-Cola Co.’s appointment of former Instacart Inc. President Carolyn Everson to its board means half the beverage company’s directors are now women for the first time.
Coca-Cola is one of a record number of S&P 500 companies that have women in at least half their board seats. The high of 21 companies, the most since Bloomberg started tracking the data in 2019...The broader outlook remains mixed, as gains and losses tend to offset each other. Women held eight more seats on S&P 500 boards in July, while men picked up 15 seats, as the number of directors overall expanded by 23 seats to 5,466. Boards usually shrink during the summer months as directors resign or retire during company annual meetings and then grow again with new appointments." BLOOMBERG
Apple Exec Quietly Exits Chinese Board Position
“An Apple Inc. executive has left the board of Didi Global Inc., as the Chinese ride-hailing company struggles to regain ground it lost during Beijing’s crackdown on the country’s internet sector. Adrian Perica, Apple’s vice president of corporate development, has resigned from Didi’s board, according to a one-sentence release posted on Didi’s website this month.... Perica joined DiDi's board after [Apple] made a $1B investment into the company to gain a further foothold in China." BLOOMBERG
Top Investor Seeks Board Control at Ammo Supplier
“Ammo Inc's largest investor wants to take control of the ammunition manufacturer's board and boost the firm's profit through growth in e-commerce of firearms, outdoor sporting and related goods…Steve Urvan, who owns 17% of the Scottsdale, Arizona-based public company and sits on the board, nominated seven director candidates, including himself, his letter to other shareholders said… Urvan thinks new directors could assess Ammo's leadership team, cut costs in its ammunitions segment, focus more on higher growth opportunities in e-commerce and consider possible acquisitions in related areas including sporting goods, apparel and collectibles. Ultimately he would also like to separate the CEO and chairman roles, a trend in corporate governance.” US NEWS
From the Boardspan Library
Board Refreshment
"In assessing your board’s composition, consider the average and range of tenure; your board’s size and committee structure; and the board’s profile in terms of skills, expertise, experience, age, gender, and compensation. Examining these, relative to the board metrics used by major institutional investors and benchmarks for companies similar to yours in industry, size, and scope, can create context and identify likely shareholder concerns... Concerns about refreshment are typically driven by perceptions of a board’s ability to oversee evolving strategies and risks. For that reason, well-run boards take an ongoing approach to refreshment and develop succession practices to meet evolving needs related to board composition… Rigorous assessments of individual directors can reveal missing capabilities, which in turn can allow for refreshment decisions and be factored into searches for new directors.” DELOITTE via BOARDSPAN
