Across the Board
Private Company Boards: Competition For Talent Is Top Concern
“Despite the conflict in Ukraine, a supply chain crunch, inflation, an ongoing pandemic, skepticism towards globalization, and other issues, the increased competition for talent remains the chief concern for private company directors, with 77 percent of survey respondents placing it among the five issues most likely to affect their company in the coming year. [This data comes from the 2022 NACD Private Company Board Practices and Oversight Survey.]” YAHOO
McKinsey Survey Identifies Leading Reasons Employees Quit Or Stay
“Despite talk of an impending recession, companies are still scrambling to retain talent. According to the latest numbers from the Bureau of Labor Statistics (BLS), there were 11.3 million open jobs on the market in May, up from 9.6 million the year before…. McKinsey & Company has released a new report that surveyed over 13,000 employees in six different countries, delving into what employees want from their jobs.… The top three reasons employees quit their job were lack of career development and advancement, low pay, and uncaring/uninspiring leadership. The top three reasons employees tended to stay at a job were flexibility, meaningful work, and adequate support for health and well-being.” FAST COMPANY
Execs Say M&A, Sustainability Initiatives Likely First Cuts In Tightening Economy
“As companies grapple with a ‘triple squeeze’ on finances, CEOs and CFOs say investment in M&A and sustainability will be the first to face cuts if the current economic situation doesn’t improve, according to a new survey. Rising inflation, talent shortages and supply constraints are all taking their toll on companies…At the start of the Covid-19 pandemic, many expected companies to shift their focus away from ESG issues as executive teams doubled down to keep companies going. Instead, firms continued to prioritize sustainability and other ESG issues, with investors also pouring money into ESG-focused funds. As such, it is surprising to see sustainability on the chopping board if cuts need to be made.” CORPORATE SECRETARY
Women CEOs Lead Only 24 of 500 Largest Companies Worldwide
“Women run just 4.8% of the companies on this year’s Fortune Global 500 list—a minuscule share that reflects barely any progress for female CEOs around the world over the past year. Women currently lead 24 of the 500 companies that appear on the Fortune list, which ranks the largest companies by revenue worldwide. That’s just one more female CEO than at this time last year, when women ran 23 such businesses, or 4.6%... The failure….to add a greater number of women to their ranks was also influenced by low CEO turnover overall during the pandemic.” FORTUNE
Nike to Share Hiring Trends for Women, Underrepresented Minorities, Amid Investor Pressure
“Nike has committed to joining some of the biggest companies in the U.S. releasing data on the recruitment and promotion trends for minority, women, and underrepresented groups within the company by 2024. In the past few years, more and more businesses have stepped up to provide more transparency when it comes to the diversity—or lack thereof—in their ranks. This shift is in part a result of the reckoning on race, equity, and inclusion sparked in 2020 following the death of George Floyd. Nonprofit shareholder advocacy group As You Sow helped lead the push, calling on Nike last year to release more information and shed a light on just how effective its diversity and inclusion programs are.” FORTUNE
PayPal Agrees to Work With Activist Investor On Value Creation Plan
“PayPal said it had entered into an information-sharing agreement on value creation with Elliott Management….The news comes a day after Elliott said it had become the top investor in social network operator Pinterest … ‘Our discussions are focused on operational improvements, revenue generating investments and capital allocation, and they are consistent with our short and long-term objectives and plans,’ CEO Dan Schulman said.” CNBC
ISS, Glass Lewis Urge Vote Against Tesla Directors on Thursday
“Two prominent and influential proxy advisory firms are urging Tesla Inc. investors to vote against the reelection of two board directors, and are recommending they defy the company’s wishes and vote for six out of eight shareholder proposals… Tesla is asking investors to re-elect Ira Ehrenpreis and Kathleen Wilson-Thompson this year, but ISS and Glass Lewis are recommending against their reelection because as members of the company’s nominating and governance committee, they did not implement a shareholder proposal that a majority of Tesla’s shareholders approved last year. The successful proposal asked to declassify the board — reorganize all board members to one class, with each director subject to election every year. Instead, Tesla is proposing that the term a director serves be reduced from three years to two years, instead of one.” MARKETWATCH
Oracle Chair Ellison Claims No Involvement In $9.3B Deal Shareholders Allege Was Overpriced
“Oracle Corp. Chairman Larry Ellison testified in a lawsuit on Wednesday that he didn’t call the shots at the company he co-founded and in which he holds a 40% stake and was not involved in discussing the acquisition at the center of the dispute. The investor suit, brought in a Delaware court by a pension fund, accuses the 8th-richest American and others at Oracle of overpaying by $3 billion for rival software maker NetSuite Inc. in 2016. Ellison owned 47% of NetSuite at the time of the $9.3 billion deal and held about 28% of Oracle’s shares. The Firemen’s Retirement System of St. Louis, an Oracle investor, sued Ellison and the company’s board in 2017 to challenge the acquisition. The case, known as a derivative suit, was brought on behalf of the company, so any money recovered will be returned to Oracle.” SILICON VALLEY
What Is Your Crisis Communication Plan for A Cyber Breach?
“In the aftermath of a cybersecurity incident, companies must make careful decisions about the information communicated, the audiences addressed and the frequency of updates. Executed correctly, a strong communications strategy can mitigate further reputational damage and start to repair trust with affected customers, investors and staff… Victims of cyberattacks must contend with the possibility that they will not be the ones to break the news of an intrusion to employees, customers, investors and the public ….” THE WALL STREET JOURNAL
From the Boardspan Library
Refreshing Your Board of Directors
"Corporate boards tend to change themselves during times of crisis—but otherwise accept the status quo. What if boards instead built regular, structured ‘refreshing’ of their membership, their processes, and their future needs into regular operations… ‘Refreshing your board’ is a new phrase in the lexicon of corporate governance. Yet the phrase is already widely recognized among directors. For most, it evokes heightened expectations of a board’s competency and preparedness to govern…The continuous improvement of board capability encompasses a number of dimensions—composition, leadership, cultural dynamics, governance policy, education, meaningful board evaluation, succession, and most critically, the board’s strategic impact. Refreshment is expected to equip boards to fulfill compliance, fiduciary duties, plus deliver competitive advantage to the enterprise.” BOARDSPAN
