Across the Board
Half-Time Reporting?
The SEC's proposal may reduce filing frequency, but companies appear reluctant to ease off quarterly governance practices
“Many companies would continue to release earnings statements quarterly—but not the more involved regulatory filings—even if U.S. authorities approve an option to file only semiannually. A new survey from KPMG provided a glimpse of the varied landscape of financial reporting that could emerge under a proposal from the SEC that would provide the option to file earnings reports twice a year instead of the usual four times…. Nearly all respondents—94%—said they plan to maintain quarterly governance and oversight practices internally, despite fewer required SEC filings…. While some companies may be well suited to semiannual reporting, others may adopt it because they lack financial discipline…. Fraud, a greater value placed on insider knowledge, and a longer shelf life for bad corporate strategy would be ‘bogies of the slower reporting cycle…'” WALL STREET JOURNAL
When Boards Collide
Andreessen Horowitz's reported antitrust probe shines a spotlight on the governance risks of overlapping board appointments
“Venture capital firm Andreessen Horowitz is the focus of a Justice Department antitrust probe over whether its investment partners are improperly serving on the boards of competing artificial intelligence companies…. Andreessen Horowitz co-founder Ben Horowitz serves on the board of Databricks, and partner Martin Casado is a board member of Fivetran…. Resolving such investigations typically requires that directors step down from one of the competing boards…. The investigation of Andreessen Horowitz, which has closely aligned itself with the second Trump administration, is particularly noteworthy. The company has forged ties to the White House and its tech portfolio stands to benefit from the minimal regulatory policies that some of Andreessen Horowitz’s team is pressing in Washington…. The investigation also represents a continuation of a key Biden-era focus on a rarely invoked 1914 law against so-called interlocking directorates, where individuals or entities sit on boards of directors for two companies that directly compete with one another…. In the Andreessen Horowitz probe however, it’s the involvement of the firm itself on competing boards, since more than one individual director is at issue.” BLOOMBERG
Megawatts and Megadeals
One of the world's largest planned AI data centers reflects the unprecedented scale of investment reshaping the industry
“Nvidia Corp. has agreed to spend as much as $105 billion to support a massive new data center campus in Ohio set to be leased by OpenAI, marking the latest tie-up between two dominant forces driving the AI boom. The ChatGPT maker has entered into an agreement to secure up to roughly 8 gigawatts of computing capacity from the Pike County complex, with the first 800 megawatts expected to come online by 2028…. In all, the purchases could represent about $600 billion of revenue for Nvidia through 2030…. Investors are likely to closely scrutinize the structure of the arrangement in light of growing fears that some AI hardware demand is being stoked by so-called circular deals…. Nvidia Chief Executive Officer Jensen Huang said in the blog post that the OpenAI pact doesn’t involve circular financing…. The Ohio data center complex as envisioned would be among the biggest in the world — a symbol of the enormous demand for computing to propel AI development.” BLOOMBERG
Platform on Trial
The first federal test case over social media addiction raises the stakes for technology companies and their boards
“Meta on Tuesday will defend itself in court again over claims it addicted young people to social media, this time in the first bellwether federal trial, brought by states seeking roughly $200 billion in damages. California, Colorado, Kentucky and New Jersey have accused the social media giant, which owns Instagram and Facebook, of harming children with technology designed to be addictive like cigarettes…. The suit charges the company with violating federal child privacy laws and state consumer protection laws…. Meta plans to argue that it put in safeguards to protect young users and that it was truthful to consumers…. The four states’ case — the first in a series of federal test cases — poses a significant legal threat to Meta after those earlier losses. If the states win, they have said, they will seek damages approaching $200 billion for consumer protection violations, according to a court filing.” NEW YORK TIMES
On the Air – and Under Fire
Disney takes on the FCC, highlighting its commitment to independent media despite political and regulatory scrutiny
“Walt Disney’s ABC has sued the Federal Communications Commission alleging the agency’s efforts to challenge its broadcast licenses and regulate its talk show ‘The View’ are illegal and an effort to quash speech the Trump administration finds objectionable…. The battle between ABC and the FCC began last year when FCC Chairman Brendan Carr launched a probe into Disney’s diversity, equity and inclusion initiatives to determine whether they violated the agency’s prohibition on unlawful discrimination. Inside ABC, executives felt that the DEI probe was really a response to commentary on some of the network’s shows, including its late night program ‘Jimmy Kimmel Live’ and daytime show ‘The View,’ both of which have been harsh critics of the Trump administration. Those suspicions escalated earlier in April when, shortly after Kimmel made disparaging remarks about Trump and the president called for the host to be fired…. ABC said that if the FCC were to go forward with a license-renewal hearing inside the agency, ‘an adverse outcome is all but guaranteed.’” WALL STREET JOURNAL
The Bottom Line on DEI
Research suggests companies that maintained DEI practices performed just as well as those that retreated
“Conservative backlash was supposed to put an end to the diversity, inclusion and equity (DEI) movement as companies were warned ‘go woke, go broke’. In January 2025, Donald Trump delivered a death knell, ending DEI within the federal government with executive orders and threatening to target companies that still supported it…. But new research published on Friday and shared exclusively with the Guardian found that companies that resisted the pressure and kept their DEI practices, including Costco, Apple and Delta Air Lines, performed just as well as their competitors who pulled back…. In the days after the executive orders were signed, companies that kept their DEI policies actually performed better on the stock market than those that didn’t. Whether or not DEI benefits a company’s bottom line can depend on its consumers…. After Trump’s executive orders, companies had to weigh the risks. Many quietly scrapped the DEI promises they had made after the murder of George Floyd and the racial reckoning it inspired. Some ended up facing a reverse backlash…” THE GUARDIAN
A Clean Bill of Audit Health
EY tops the PCAOB's audit quality rankings after a major overhaul of its US audit practice
“EY has shed its status as the Big Four accounting firm with the worst record in US audit inspections, vaulting to lead the regulator’s audit quality league table jointly with Deloitte. The improvement comes after EY US restructured its audit division, invested in new technology and shed some tricky clients…. Reports published on Thursday by the [PCAOB] showed its inspectors found flaws in just 5 per cent of the EY US audits it examined. That was the biggest improvement of all the Big Four…. EY [vice-chair] said the result validated ‘investments we’ve made in technology, data analytics, streamlined methodologies and our people to strengthen trust in financial reporting’.” FINANCIAL TIMES
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