11/13/25 – Issue 10.45 – Your weekly news on all things board. 

Shareholder influence comes under scrutiny. Various branches of government are exploring pathways to curb the influence of proxy advisers and index fund giants, in a bid to upend their power in shareholder voting and their influence on ESG-related shareholder proposals. The Federal Trade Commission announced the launch of an antitrust probe into the proxy firms ISS and Glass Lewis. The Trump administration is also reportedly considering a ban on shareholder recommendations and other measures that would curb the influence of proxy firms and index fund giants like BlackRock and Vanguard.  At the same time, SEC Chairman Paul Atkins is signaling a potential change in legal interpretation that would favor state law over federal law in shareholder proposal governance, a development that could significantly alter how boards engage with activism. Already, the administration’s stance on climate change has introduced new norms for corporate action and messaging around environmental policies. Meanwhile, the approval of a $1 trillion pay package for Tesla CEO Elon Musk raises deeper questions about CEO leverage and the precedent it sets for board decision-making. AI governance frameworks remain an urgent priority. And at Diageo, a bold CEO appointment underscores a growing demand for turnaround leadership at the top. Power and influence, it seems, are being renegotiated with regularity.

In the Spotlight

Proxy Advisors ISS and Glass Lewis Face Antitrust Probes

FTC investigation is focused on how proxy advisers steer investors on climate, ESG issues

“The Federal Trade Commission is investigating whether proxy advisory firms Institutional Shareholder Services and Glass Lewis violated antitrust laws through their business of guiding shareholder votes on contentious topics, people familiar with the matter said. The investigation is the latest move putting pressure on the two influential advisers, which investment managers rely on for research, analysis and recommendations on how to cast shareholder votes on issues ranging from executive compensation to board elections. The probe, which is in its early stages, is focused on the firms’ competitive practices and how they steer clients on hot-button issues such as climate- and social-related shareholder proposals…. Corporate executives and business groups such as the U.S. Chamber of Commerce have for years complained about the influence of proxy advisers that challenge management’s view on shareholder votes.” WALL STREET JOURNAL

White House Explores Rule Changes on Shareholder Voting

New measures aim to curb the influence of proxy advisers and large index funds

“The White House is exploring new measures to curb the influence of proxy advisers which conservatives have for years complained push liberal-leaning views, according to a financial industry official briefed on the matter. Trump administration officials are also exploring limits on how index-fund managers are allowed to vote, the person said on condition of anonymity to discuss confidential regulatory matters. The Wall Street Journal first reported on Wednesday that administration officials are discussing at least one executive order that would restrict proxy-advisory firms such as Institutional Shareholder Services and Glass Lewis, citing people familiar with the matter....The industry official said the administration has been ‘kicking around’ ideas for a few months on how to regulate or curb proxy voting and the proxy advisers.” REUTERS

SEC Chair Signals Greater Role for State Law in Determining Appropriateness of Shareholder Proposals

In a recent speech, SEC Chairman Atkins challenged long-standing assumptions about tools frequently used by activist shareholders with very small holdings to press for change

“U.S. Securities and Exchange Commission Chairman Paul Atkins signals a greater role for state law in defining shareholders’ ability to place proposals on company proxy statements. Over the past decade, activist shareholders have increasingly wielded a powerful tool—the Rule 14a-8 shareholder proposal—in their efforts to exert pressure on corporate America to endorse social and political objectives. Indeed, in some sense, shareholder proposals have served as a microcosm of the rise of ESG and anti-ESG initiatives, turning the proxy statement into a special interest battleground. Rule 14a-8 has historically permitted holders of very small amounts of stock to require that companies include a proposal on the company’s proxy statement. These proposals are often framed as non-binding, but are nevertheless intended to put pressure on boards to undertake a requested action…. While the scope and application of Rule 14a-8 has ebbed and flowed with the political winds, it has largely been assumed by companies and activists alike that shareholders have the right under state and federal law to submit these non-binding proposals. The SEC’s current Chairman, Paul Atkins, however, has posed a fundamental challenge to that assumption…. If Rule 14a-8 is no longer a viable tool for shareholder activists, companies should be prepared for shareholders to increasingly submit proposals through companies’ advance notice bylaws.” HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE

From Boardspan this Week

So Your Board Chair Is Due to Step Down

What happens next will define your board for years. Because how your board selects its next leader can make or break your board's continued effectiveness. In this latest article, we explore how to navigate chair succession with transparency and alignment, resulting in a stronger board on the other side.

Across the Board

Tesla Shareholder’s $1 Trillion Decision Could Affect Every Board

If your current CEO sent a letter to your board with a proposal that would make them the highest paid CEO among your peers, then added, if you don’t go along with it, I’ll quit, what would you do?

“On November 6, Tesla shareholders voted to approve Elon Musk’s $1 trillion executive compensation plan—and it may have farther reaching consequences for corporate boards than might have first been considered…. Musk’s latest pay package guarantees the mercurial CEO about $1 trillion in stock awards over a 10-year period if he meets several ambitious goals that include increasing Tesla’s market value from $1.5 trillion to $8.5 trillion, launching a fleet of one million self-driving robotaxis, and deploying one million humanlike robots…. Since Musk has decided to continue to push the envelope with the value of his compensation packages in recent years, don’t think that other CEOs are not studying the type of compensation packages he has proposed and are considering whether they can put forth something similar. What will you do if such a proposal comes to your boardroom?” CORPORATE BOARD MEMBER

How Companies Are Reframing Climate Communication in 2025

While federal policy is changing the tone, the corporate climate conversation is evolving from aspiration to action

“Despite the shifting landscape of climate action in recent months — including significant reversals in federal climate policy and increased regulatory scrutiny of ESG collaborations — companies are not abandoning their climate strategies but instead changing how they communicate their initiatives… The climate conversation isn’t flatlining but transforming. Recent discussions among business leaders and policymakers — including during Climate Week NYC — have noticeably shifted in tone and focus. Virtue-focused language, such as ‘green’ and ‘doing good,’ is being replaced with conversations about risk, measurement and investment, reflecting the shift in investor and policymaker priorities and aligning with the broader emphasis on action over aspiration.” HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE 

No Blind Spots: The Board’s Role in Sustainability
Boards that treat sustainability as a compliance issue are missing the point and the opportunity

"What was once treated as a peripheral topic is now a core strategic consideration…. Boards need to consider climate physical risk. In 2024, insured losses from natural catastrophes such as storms, floods, wildfires, and earthquakes reached $137bn, marking the fifth consecutive year with insured losses above $100bn.  This figure only tells part of the story. Swiss Re reports that just over  , leaving more than half uncovered and bringing the total global economic cost to $318bn. The data exposes a significant and widening protection gap with serious financial and social consequences.” INTERNATIONAL INSTITUTE FOR MANAGEMENT DEVELOPMENT

Charting the Boardroom’s AI Roadmap
To unlock AI’s value while minimizing risk, boards must adopt a proactive governance framework crafted in close collaboration with management and legal advisors

“All boards are different, but there are three critical assets that great boards possess to contribute to their effectiveness. First, they have deep and varied experiences that enhance their business judgment. Second, they take a long-term, enterprise-wide approach to evaluating the success of the business. Third, they work closely with management, but they maintain their oversight role and one-step separation from the daily operations of the business so they can provide perspective and ask challenging questions about strategy. AI can significantly enhance those critical functions of the board by addressing the longstanding issue of information asymmetry between boards and management. At the same time AI capabilities offer opportunities for boards, the technology can raise new risks that boards and management should anticipate and address together.” PWC

Smart Boards Don’t Stay Still

Boards that evolve with the company’s stage, anticipating shifts in scale, complexity, and risk are best equipped to lead through growth, maturity, and disruption

“As a company matures, its strategic challenges change. And so too should its leadership. Management theory is clear that organizational design should be situational. A chief executive with a certain style of the leadership that can be a springboard for a growing company could kill a more mature business – or be dangerous for a company in crisis. A firm which is scaling up will face very different strategic demands from one which is consolidating or trying to sail through turbulence. Despite this, boards are treated as if “one size fits all”, reinforced by governance codes and proxy advisors that encourage uniformity, even as firms move through different eras. When the board’s design and focus do not reflect the company’s situation, the consequences can be significant.” LONDON SCHOOL OF ECONOMICS BUSINESS REVIEW

Diageo Taps Former Tesco CEO to Lead Growth Turnaround

As growth stalls, Johnny Walker maker Diageo turns to former Tesco CEO Dave Lewis, credited with one of retail’s most notable turnarounds to restore momentum and operational discipline

“Diageo appointed former Tesco boss Dave Lewis as its CEO on Monday, ending a months-long search and turning to an outsider to revive growth at the world's largest spirits maker during a challenging period. Lewis, 60, will be tasked with turning around the Johnnie Walker whisky and Guinness beer maker, which is grappling with tariff hikes in the United States, its biggest market, high debt levels, and a move away from alcoholic drinks by younger consumers…. Lewis was CEO of UK supermarket group Tesco from 2014 to 2020. Tesco was on its knees shortly after Lewis joined in 2014 due to an accounting scandal that knocked millions off its profits and billions off its share price, but four years later he declared Tesco's turnaround complete, its position as clear market leader reinforced.” REUTERS

Seat at the Table

• Intel appoints to its board Dr. Craig Barratt, former CEO of Atheros Communications

• S&P Global elects to its board Robert Moritz, former Global Chairman of PricewaterhouseCoopers LLC

• Ameriprise Financial welcomes to its board Liane Pelletier, former Chair, CEO and President of Alaska Communications Systems Group

• Sensor firm TE Connectivity adds to its board Ken Washington, former SVP and Chief Technology and Innovation Officer at Medtronic

• Wayfair welcomes to its board Hal Lawton, CEO of Tractor Supply Company

• Communications infrastructure firm Dycom announces to its board Stephen LeClair, former CEO of water firm Core & Main

• Watts Water Technologies elects to its board Suzanne Stefany, Senior Advisor to PJT Partner

• Utility firm Centuri Holdings names to its board Dustin DeMaria, Senior Analyst at Icahn Enterprises and Icahn Capital

• Engineering firm CTS Corporation welcomes to its board Kimberly MacKay, SVP, General Counsel, and Corporate Secretary of West Pharmaceutical Services

• Battery storage firm Sunrun announces to its board Craig Cornelius, President and CEO of Clearway Energy Group

• C3 AI appoints to its board Mike Clayville, former Chief Customer Officer at Stripe

About Boardspan
Boardspan helps boards raise the bar on their critical governance mandates by combining cutting edge digital capabilities with high-touch consulting services. They are leaders in board assessments, individual director & CEO evaluations, board succession strategy & search, skills & composition analyses, and bespoke advisory work. Boardspan’s focus is entirely on boards, delivering deep experience, objectivity, an analytical orientation, and insight-driven recommendations. Boardspan works with public, private and non-profit organizations across all verticals including consumer, healthcare, financial services, technology, industrials and non-profit. Specific clients include Archer Daniels Midland, Autodesk, Blue Shield (CA), Boston Beer Company, Colgate-Palmolive, e.l.f. Beauty, HubSpot, Ingersoll Rand, KKR, Lam Research, the PGA, Roblox, Salesforce, the USOPC, and scores more.