Across the Board
Jana Presses Six Flags on Sale and Board Leadership
Move comes one week after NFL star Travis Kelce was appointed brand ambassador
“Activist investor Jana Partners wants theme park operator Six Flags Entertainment to explore a sale and immediately appoint a new head of its board of directors, according to a letter reviewed by Reuters. The call for change comes just months after North America's largest regional amusement resort operator hired a new chief executive and less than a week after it appointed National Football League star Travis Kelce as brand ambassador…. While Jana has publicly expressed support for new CEO John Reilly, it said in the letter that it wants to see a new board chair after months of private engagement raised concerns about the group's effectiveness.” REUTERS
Victory Capital Raises Stakes in Bid for Janus Henderson
Sweetened offer challenges board-backed deal with Trian and General Catalyst
“Victory Capital sweetened its offer to buy Janus Henderson, whose board last week unanimously rejected the company’s takeover proposal and recommended shareholders back a take-private transaction by Nelson Peltz’s Trian Fund Management and venture firm General Catalyst…. Victory Capital said the new terms add $10 a share in cash and roughly $1.2 billion in incremental aggregate consideration compared with its prior proposal…. Janus Henderson said it will evaluate the received proposal and that, at this time, the board hasn’t withdrawn or modified its recommendation that shareholders vote in favor of the Trian deal.” WALL STREET JOURNAL
When Government Partnerships Test Board Oversight
A shareholder lawsuit challenging Intel’s deal with the U.S. government alleges the board didn’t fully consider shareholder interests and calls future governance into question
“A shareholder has filed a lawsuit challenging Intel’s decision to grant a 10% equity stake to the U.S. government. The suit argues that the board of Intel may not have fully protected shareholder interests when approving the deal. The case raises fresh questions about governance, board oversight, and Intel’s relationship with federal authorities…. Looking ahead, the case could influence how investors assess board oversight, potential dilution from government ownership, and future government tie ups. The outcome may also shape expectations for how Intel structures any additional collaborations with public authorities, which could matter for shareholders who are focused on governance standards as much as on the current share price.” YAHOO FINANCE
Rethinking the Defensive Playbook on Activism
Why early reactions can shape outcomes, and how boards can get it right
"Boards and management all have the same fear – the ominous news story, 13D filing, or even the first phone call when an activist investor introduces themselves as one of their largest shareholders. What happens next is swift and often sets the tone for the engagement…. [Boards can get themselves into trouble by:] Approaching meetings strictly as ‘listen only’ sessions, thereby preventing an intelligent exchange of ideas. Advisors may recommend that their clients engage in this approach to mitigate risk and better understand the activist’s objectives to get ahead of their demands. This can lead to frustration among activists, who may feel the engagement lacks genuine dialogue, which may lead the activist to make their concerns public. …. [Or] Slow-rolling discussions to delay meaningful engagement until after a key calendar event or the nomination or record dates. Activists recognize these delay tactics immediately, viewing them as an attempt to run out the clock and avoid accountability. Activists don’t necessarily need speed, but they expect clear, reliable timelines for follow-ups and next steps….” FORTUNE
How Directors Stay on the Board Without Majority Support
Ongoing board service by majority-unsupported directors, enabled by plurarily voting, is a symptom of underlying governance concerns
"Out of the 22,635 U.S. director election proposals Glass Lewis covered in the 2025 proxy season, there were 72 directors from 48 different companies who did not receive majority shareholder support. Of those 72, only seven successfully resigned. Six had their resignations rejected and the remaining companies took no action, instead ignoring the vote outcome and letting the directors continue to serve despite not receiving majority shareholder support.... This lack of responsiveness is largely driven by the continued prevalence of plurality voting standards, where nominees receiving the most “for” votes are elected to the board regardless of whether they receive majority support. And it is perpetuated by the presence of negative governance features such as classified boards and multi-class share structures, which both lead to, and insulate directors from, shareholder opposition.... The continued service of majority-unsupported directors on companies’ boards is often a symptom of underlying governance concerns. In addition to the governance issues driving the voting opposition, their continued presence indicates a lack of board accountability and responsiveness to shareholder concerns. These concerns are exacerbated when companies fail to provide disclosure addressing the opposition." HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE
SEC Prepares Proposal to Eliminate Quarterly Reporting Requirement
Proposal would give companies the option to report earnings twice a year
“The Securities and Exchange Commission is preparing a proposal to eliminate the requirement to report earnings quarterly and instead give companies the option to share results twice a year, according to people familiar with the matter…. The regulator could publish the proposal as soon as next month, the people said. In preparation for the proposal, regulators have been talking to officials at the major exchanges to discuss how they may need to adjust their rules. Once the proposal is published, it will be subject to a public comment period. After that period, which typically lasts at least 30 days, the SEC will vote on it. There are no guarantees it will ultimately happen. The rule is expected to make quarterly reporting optional, not eliminate quarterly reports altogether.” WALL STREET JOURNAL
The Changing Dynamics of Shareholder Voting
As decision-making by institutional investors becomes less centralized, companies will need to reassess the way they build support for important votes
“Proxy advisory firms have increasingly come under attack by regulators and were the targets of a White House executive order in December that may significantly impact their influence over the entire proxy voting ecosystem. Most recently, it was reported that JPMorgan and Wells Fargo would stop using the services of proxy advisory firms, including Institutional Shareholder Services (ISS) and Glass Lewis, for research on public companies and voting recommendations on shareholder proposals and director elections…. As we head into the 2026 proxy season, these changes could make shareholder votes less predictable. Moreover, if shareholder decision-making is less centralized, boards and management teams will need to rethink their investor outreach programs and disclosures to reach a wider audience.” HARVARD LAW SCHOOL FORUM ON CORPORATE GOVERNANCE
Backing the CEO in a Politicized Environment
How boards can back CEOs while resisting undue external pressure
“Corporate boards increasingly find themselves navigating political pressure that crosses from regulation into coercion. CEOs are summoned, threatened or publicly shamed over decisions that properly belong to management and shareholders. This can involve selective regulatory hurdles, coerced ownership and revenue surrender, threatened consumer boycott calls, compensation and staffing decrees, and such interventions. Too often, boards respond with appeasement—conceding ground in hopes of quieting the moment…. Five practical lessons for board members and companies navigating political pressure: 1. Do not concede what you do not own…. 2. Avoid public confrontation that corners…. 3. Unity Is non-negotiable…. 4. Embrace collective action with peers…. 5. Meet grandiosity with merit….” CORPORATE BOARD MEMBER
Stability Over Strictness in CEO Pay
Increasingly boards are using compensation levers to manage uncertainty and protect incentive outcomes
“According to an analysis by Compensation Advisory Partners, corporate boards are employing methods to safeguard executive compensation from economic and policy volatility. The firm's review of pay data from 50 public companies indicates that total CEO pay increased by 8% in 2025, with annual bonus payouts rising 4%. Median financial performance for these companies was generally flat to up, with median revenue growth of 2.9% and earnings per share down slightly at negative 1.6%. The analysis found that even at companies with the weakest performance, CEOs still received 87% of their target bonuses, an increase from 77% the year before…. Boards have utilized techniques such as setting more-conservative targets, widening performance curves, and flattening payout ranges.” INDEX BOX
|
|
