1/30/25 – Issue 10.04 – Your weekly news on all things board. 

It’s turbulent at the top. Corporate leaders are navigating a complex mix of governmental, investor, and workforce demands, some of which seem impossible to reconcile. The saga surrounding U.S. Steel is a prime example: its $14 billion merger with Nippon Steel was blocked by the Biden Administration with the support of union leaders; now the company’s bid to revitalize the merger is supported by the union, thanks to new concessions and growing concern that without Nippon’s proposed investment in the company, many jobs will be lost. But activist investment firm Ancora Holdings sees a different path to success and has ramped up pressure on U.S. Steel to let go of the merger, along with its CEO, and seeks to install nine new directors.

Meanwhile, as Silicon Valley giants ally themselves with the Trump Administration and distance themselves from DEI initiatives, discord is growing among employees who have come to expect a more liberal stance from tech companies. Facebook employees have taken it upon themselves to provide amenities once supplied by the company for their transgender coworkers, while a Google employees union appeals to the CEO to rethink its approach to layoffs. Going forward we expect to see more challenging dynamics as government, workforce, and investor expectations continue to shift. 

In the Spotlight

Activist Ancora Pushes U.S. Steel to Drop Merger with Nippon Steel, Oust CEO

Firm waging proxy fight at American steelmaker, seeking nine board seats

“Activist investor Ancora Holdings is waging a proxy battle at U.S. Steel and wants the company to turn the page from its failed marriage with Nippon Steel. Ancora unveiled a strategy that would rally shareholders around a plan to oust U.S. Steel’s chief executive and drop litigation to salvage a merger with the Japanese steelmaker… Ancora has nominated nine director candidates to U.S. Steel’s 12-person board, including former Stelco CEO Alan Kestenbaum. Stelco, a Canadian steel company, was acquired by Cleveland-Cliffs last year. U.S. Steel said it is still committed to pursuing the deal with Nippon Steel.” WALL STREET JOURNAL

U.S. Steel and Nippon Push to Revive Takeover

The two steel makers are seeking to revive Nippon Steel’s $14 billion takeover of U.S. Steel after it was blocked by the Biden administration

“U.S. Steel agreed to Nippon’s $14 billion proposed bid in late 2023, which shareholders later approved. But the deal faced significant pushback from the steelworkers’ union, and former President Joseph Biden blocked it, citing national security concerns, shortly before leaving office. Both U.S. Steel and Nippon sued the Biden administration and the Cleveland-Cliffs, arguing that the national security review process for the deal had been corrupted. The Cleveland-Cliffs’ chief executive, Lourenco Goncalves, has signaled that he is preparing a fortified bid for U.S. Steel.” NEW YORK TIMES

Pfizer Dodges Challenge to Its Board in Battle with Starboard 

Starboard CEO Jeff Smith’s activist challenge got off to a shambolic start, with two former Pfizer executives initially backing Starboard’s efforts before reversing course

“Starboard did not nominate any directors to Pfizer’s board ahead of a Jan. 25 deadline for the company’s annual meeting in April… The news eases some of the pressure on Pfizer Chief Executive Officer Albert Bourla, who has insisted the company is on track to reverse its steep post-pandemic decline… It’s not necessarily over yet, though. Starboard, which took a roughly $1 billion stake in Pfizer late last year, could still propose changes to the company’s board in 2026 if the two sides don’t reach a settlement before then.” MINT

Serving on a Board as an Activist’s Nominee

No matter who nominates a director to the board, that director must act independently and in the company's best interest

“You've just been elected to the board of a company as the result of an activist having nominated you in a proxy contest. Now what? … It should be made clear that, once elected, the new board member owes his or her allegiance to all the shareholders, not solely to the activist, despite the fact that he or she nominated you. While the new director may have been initially convinced that the activist's strategy was wise, he or she must be totally objective in future board deliberations as to the best future course of action for the company in the long term.” DIRECTORS & BOARDS

From Boardspan this Week:

How Boards Can Get Ahead in 2025

Here we are in 2025 with some exciting opportunities on the horizon albeit with big challenges to face. Our advice -- take them head-on! As you work through what is possible with your organizations, also plan for higher governance expectations, evolving stakeholder priorities, and unprecedented geopolitical uncertainties.

Across the Board

With Tampons and Code, Silicon Valley Workers Quietly Protest Tech’s Rightward Shift
As Mark Zuckerberg and other tech titans have embraced President Trump and muffled internal dissent at their companies, their mostly left-leaning employees have objected with subtle acts of defiance

“The quiet dissent underlines who wields the power in Silicon Valley these days: the bosses. Tech workers once called more of the shots because of a competitive labor market and freewheeling workplace cultures, but Mr. Zuckerberg and other top executives have reasserted control. They have raised performance expectations, clamped down on employee discussions and fired some who they saw as activists. And with mass layoffs at tech companies in recent years — led by Elon Musk’s shedding of more than three-quarters of the employees at X, formerly known as Twitter, in 2022 — workers are now opting for muted subversion rather than rowdy protests.” NEW YORK TIMES 

'Really anxious': Google workers, fearing layoffs, launch pressure campaign on CEO

More than 1,300 employees have signed an Alphabet Workers Union petition with multiple demands

“As the drumbeat of layoffs at major tech companies slows but does not cease, a mass of Google workers has joined a new campaign pushing for job security at the Bay Area giant. By noon on Tuesday, more than 1,300 Google employees had signed a ‘Googlers for Job Security’ petition distributed by the nascent Alphabet Workers Union. The letter, addressing billionaire CEO Sundar Pichai by his first name, begins by bemoaning the impacts of layoffs’ on worker morale. It then calls on Google to offer voluntary buyouts before laying people off, guarantee a minimum level of severance benefits and not lower performance review ratings as a pretext for cutting staff.” SFGATE

Ben & Jerry's Accuses Unilever of Muzzling

Both companies have been publicly at odds since 2021 when Ben & Jerry's decided to stop selling Cherry Garcia, Chubby Hubby and other ice cream flavors in the West Bank

“Ben & Jerry's ratcheted up its censorship lawsuit against Unilever on Friday, accusing its parent company of suppressing a social policy statement the U.S. ice cream maker wanted to release because it mentioned President Donald Trump. The allegation came in an amended complaint filed in Manhattan federal court, where Ben & Jerry's in November accused Unilever of silencing its attempts to express support for Palestinian refugees and end military aid to Israel, and threatening to dismantle its independent board… Ben & Jerry's wants a court order freeing the board to continue oversight of its social mission, and requiring Unilever to honor its commitment to make $25 million of payments to groups chosen by the ice cream company.” REUTERS

Succeeding at Succession
Effective succession planning is not merely about replacing a CEO but ensuring continuity, cultural alignment, and readiness for future challenges

“Many boards aren’t fully prepared for CEO departures despite succession planning being one of their primary responsibilities. Yet this is a responsibility boards can’t afford to get wrong—without the right person at the top, even the best companies with the most innovative strategies will struggle… Planned successions allow for a comprehensive assessment of internal and external candidates and align with long-term strategic goals. Emergency successions, however, require readiness to act decisively and rely more heavily on existing talent pipelines. Boards must consistently evaluate the company’s leadership bench to prepare for either scenario.” CORPORATE BOARD MEMBER

Building a Healthy CEO and Board Relationship

Walking the delicate balance of trust and accountability

“Sometimes the relationship can verge on being precarious, and at worst ineffective and inflamed, to the great detriment of the organization and everyone involved. One well-trodden narrative suggests that a board exists primarily to oversee the CEO’s work, representing the interests of shareholders and ensuring the company’s performance aligns with long-term strategic goals. Although technically correct, this view is limiting, if not outright misleading. In reality, CEOs have significantly more influence over their boards than most either realize or dare to take advantage of.” FORBES

How Board Members Are Prepping for Proxy Season 2025

Directors anticipate a slate of shareholder proposals on ESG, time-based incentive compensation, supermajority voting and director qualifications as Trump 2.0 policies take hold

“If past is prologue, the number of shareholder proposals in the 2025 proxy season will rise yet again, having jumped forward the past four years in a row. In 2024, proposals increased by 4 percent to 929, led by a 13 percent hike in governance proposals. Chief among them were the 45 shareholder recommendations to ditch supermajority voting in favor of simple majority votes, which garnered an average 70.5 percent support, up from 57.9 percent in 2023. These varied subjects, while certainly challenging for boards, pale in comparison to the expected furor over anti-ESG proposals. The number of anti-ESG proposals reached a record 107 in 2024, although none received more than 10 percent shareholder support.” CORPORATE BOARD MEMBER

Boards Taking Action to Improve Cybersecurity Governance

No more delegating—when it comes to oversight of cyber risk, boards are tackling it head (and hands) on

“Directors know they must be more aware and directly involved. In fact, 88% of them now view cybersecurity as a business risk as opposed to a technology problem… Adding fuel to their fire: the likelihood of more government regulatory pressure. For example, the Securities and Exchange Commission (SEC) floated new rules that would require publicly traded companies to disclose their cybersecurity governance practices, including how boards oversee cyber risk. The announcement has prompted considerable debate and controversy. And while organizations are not required to appoint members who are versed in technology or cybersecurity issues, the proposed SEC rules would mandate that they divulge whether they have done so.” HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE

Seat at the Table

• Cybersecurity firm Securonix adds to its board Bethany Mayer, former President and CEO of security solutions firm Ixia

• Mitek Systems announces to it is board Mark Rossi, Co-Founder of Cornerstone Equity

• Norfolk Southern names to its board Lori Ryerkerk, former Chairman, CEO and President of materials firm Celanese Corp

• CSX Corporation announces to its board Ann Begeman, former Republican Staff Director for the U.S. Senate Committee on Commerce, Science, and Transportation

• Bank of America adds to its board Maria Martinez, former COO of Cisco

• Matador Resources Company appoints to its board Paul Harvey, former CIO and Senior Portfolio Manager at Vaquero Private Wealth

• Retail firm Macerich elects to its board Devin Murphy, former President of Phillips Edison & Company

• Electric product manufacturer Data I/O Corporation welcomes to its board Garrett Larson, Senior Equity Analyst at Karen Wealth Management

• First Horizon Corporation elects to its board Jeffrey Brown, President of Hendrick Automotive Group

• Electronic trading platform MarketAxess Holdings welcomes to its board Roberto Hoornweg, Co-Head of Corporate & Investment Banking at Standard Chartered

• Retail clothing firm Land’s End adds to its board Gordon Hartogensis, former Director of the Pension Benefit Guaranty Corporation

• Energy efficiency builder Carlisle Companies welcome to its board Sheryl Palmer, Chairman, President and CEO of the Taylor Morrison Home Corporation

• Software firm Ceva adds to its board Amir Faintuch, CEO of data infrastructure firm Volumez 

• AMP Robotics elects to its board David Steiner, former CEO of WM

• Software firm SugarCRM appoints to its board Bob Stutz, former CEO of Marketing Cloud and Chief Analytics Officer at Salesforce

• Kennametal names to its board Douglas Dietrich, Executive Chairman and CEO of Mineral Technology

• Tobacco firm Altria Group elects to its board Richard Stoddart, former President and CEO of marketing firm InnerWorkings

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 only works with boards, bringing deep experience, objectivity, an analytical orientation, and insight-driven recommendations. Clients include Blue Shield (CA), Colgate-Palmolive, Deckers, Dynatrace, elf Beauty, HubSpot, Ingersoll Rand, KKR, Lam Research, the PGA, Roblox, Salesforce, Synopsys, the USOPC, and scores more.