Director's Domain: Corporate Governance News & Board Insights
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October 24, 2024
This week’s newsletter may seem quieter than usual, but with the presidential election just two weeks away, it feels a bit like the calm before the storm. Interestingly, however, a noticeable theme emerges around the fundamentals of board service. Disney has tapped boardroom veteran James Gorman to lead the essential task of CEO succession, aiming for a smooth and lasting transition after a tumultuous year. Meanwhile, Starboard is pushing Pfizer’s directors, and Elliott pressured and reached a settlement with Southwest on board and management accountability — underscoring a board’s fiduciary responsibility related to underperformance. A highlight in the 2024 BDO Board Survey is the opportunity to leverage technology for growth. And finally, the “ABCs of Boardroom Dynamics” reinforce a core principle: good governance is the bedrock of success for companies and the boards that guide them.
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October 17, 2024 -
In an era where the pace of business is faster than ever, recent surveys reveal that many corporate boards may be evolving too slowly to keep up with today's challenges. At the core of this issue is governance—the foundation of effective board service. Whether it's technology oversight, as seen in CrowdStrike's recent outage and its potential director liabilities, reevaluating board composition to drive value creation, or grappling with the devastating consequences of climate change, governance plays a crucial role in keeping companies agile and prepared for both strategic and unexpected challenges. This week's newsletter delves into these topics, including the value of age diversity on boards and how directors can lead on climate oversight. Lastly, no week would be complete without the latest activist developments, with Elliott and Edge One serving as reminders that strong governance is essential for smooth, strategic, and successful business operations.
Read OnOctober 10, 2024 -
As we enter the final quarter of 2024, DEI, Activism, and AI remain at the top of directors' minds. This week's issue digs into how directors navigate these complex topics at a breakneck pace while remaining forward-looking, providing invaluable insight and effective oversight. A compelling study conducted by e.l.f. Beauty and North Carolina A&T State University begins to answer the critical question of whether diversity positively impacts company performance with evidence leading to a resounding "Yes." With an activist environment still percolating, boards are equipped with proactive strategies to address activist and stakeholder concerns that are part of good director succession planning. And finally, AI continues to dominate the headlines with immense opportunities and risks that demand directors' attention. All to say, boards are continuously challenged to provide long-term stewardship over evolving, impactful topics.
Read OnOctober 03, 2024 -
Regulatory scrutiny, relentless innovation, and investor demand for results define the business landscape. The FTC, which has had a tight grip on corporate transactions as it aims to ensure ample competition in markets, this week approved Chevron's acquisition of Hess, provided Hess's CEO has no seat on Chevron's board. As AI gets baked into businesses everywhere shareholders demand justification for the enormous investments in AI, and OpenAI announces a new round of funding that positions it as one of the most valuable start-ups in history. Activist investors continue to be, well, active, with Glenview Capital pushing CVS to make changes.
Read OnSeptember 26, 2024 -
Whether they call it "growth," "scaling," or "hitting the numbers," most boards are looking to help companies size up. So, it's worth noting that the "bigger is better" motto faces some serious headwinds from the Justice Dept, which in recent years has brought antitrust cases against many of the largest companies in the U.S. This week, the government opened a suit against Visa, accusing it of running a debit card monopoly that has allegedly cost American consumers and businesses billions of dollars. Antitrust suits have been opened against Google, Apple, Amazon, and plenty of others as the government seeks to ensure competition in industries whose dominant players have for some time had the resources to buy or outmaneuver most rivals. Downstream impacts on the industries involved and on future acquisitions could prove significant. Meanwhile, some big transitions announced this week include the sudden departures of CEO John Donahoe from Nike and several Open AI execs including CTO Mira Murati as the firm announces its intentions to become for-profit, while filmmaker James Cameron joins the board of directors at Stability AI, an artificial intelligence firm focused on computer-generated imagery (CGI) and video production. Cameron's arrival on the corporate stage comes 40 years after his iconic film The Terminator portrayed the existential threats posed by rogue artificial intelligence and comes at a critical juncture for the entertainment industry (and all business) as it grapples with a new wave of AI-related issues concerning everything from copyright and originality to ethics and workforce upheaval.
Read OnSeptember 19, 2024 -
Rarely do directors resign en masse from public company boards, but all seven independent directors exited the 23andMe board this week after the CEO failed to produce a definitive plan to meet her goal of taking the genetic testing company private. The departures came on the heels of the company’s $30 million settlement agreement following a data breach affecting 6.9 million users. CEO Anne Wojcicki said she would swiftly launch the search for new directors. Meanwhile, labor issues have been front and center for many companies since the pandemic as workers increasingly sought higher pay and better work-life balance in a tight labor market. This week Amazon, presumably reacting to a looser market, announced that workers will be expected to routinely work in the office five days a week, while hundreds of Amazon contract delivery drivers voted to join the Teamsters union as they collectively seek improved work conditions. This week also sees intriguing and valuable perspectives on the ever-evolving role of the board, with increasing oversight demands on topics ranging from human capital to AI, the arrival of new activist investor strategies for gaining an advantage in proxy fights, and more.
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