– CNN reported that Alex Cruz was stepping down as chair and CEO of British Airways, which is owned by International Airlines Group (IAG). Sean Doyle, CEO of Irish airline Aer Lingus, which is also owned by IAG, will become British Airways CEO with immediate effect and will also take over from Cruz as chair after a transition period. Doyle worked at British Airways for two decades before moving to head Aer Lingus nearly two years ago.
Donal Moriarty, the chief corporate affairs officer at Aer Lingus, will become interim CEO while a permanent replacement is sought, IAG said. ‘We’re navigating the worst crisis faced in our industry and I’m confident these internal promotions will ensure IAG is well placed to emerge in a strong position,’ said IAG CEO Luis Gallego in a statement, thanking Cruz for working ‘tirelessly to modernize’ IAG’s flagship carrier.
– The Wall Street Journal noted that CEOs are increasingly agreeing that a company’s ESG practices will play a role in its future success. The paper cited a global PwC survey, which found that a quarter of CEOs now strongly agree that investing in climate-change initiatives could lead to significant new product and service opportunities for their companies, up from 13 percent in 2010. ‘Don’t underestimate the impact of one CEO or one major company making a decision,’ said Alan McGill, global sustainability assurance leader at PwC.
The Covid-19 pandemic and social unrest over racial justice have sped up the shift toward sustainability at many companies this year after both issues exposed inequality in the economy, says Rebecca Henderson, a Harvard Business School professor. ‘Five years ago, the argument was all about trying to persuade CEOs to take sustainability concerns and move them into the mainstream of the business,’ she says. Now ‘everyone I talk to has the sense they ought to be [doing this].’
– Reuters reported that the US Supreme Court agreed to decide whether more than 100 technology disputes must be reheard because judges were unconstitutionally appointed to a US Patent and Trademark Office tribunal. The justices said they would review a 2019 lower court decision that found a ‘constitutional defect’ in how Patent Trial and Appeal Board judges are appointed.
– The SEC appointed Jessica Kane director of the division of corporation finance’s disclosure review program. In her new role, Kane leads the division’s work reviewing transactional, periodic and current reports and leads initiatives to monitor and enhance the effectiveness, relevancy and transparency of disclosures. She has served as director of the office of credit ratings since 2017.
– The Guardian reported that 30 of the world’s largest asset owners, with portfolios worth a combined $5 trillion, committed to cutting the carbon emissions linked to companies they invest in by up to 29 percent within the next four years. Members of the UN-backed Net-Zero Asset Owner Alliance – which includes Aviva and CalPERS – will each set decarbonization targets for 2025 as part of wider efforts to align their portfolios with the Paris climate accord goals and achieve net-zero emissions by 2050.
The group hopes to avoid divesting from polluting companies and instead encourage them to reduce their emissions and help limit global temperature rises to 1.5C. Some of that will be achieved by pressing companies to supply mandatory climate reports and produce clear business transition plans.
– According to CNN, thousands of Amazon’s tech workers have signed a petition calling for the company to provide paid time off to all of its employees to vote. Between Amazon’s corporate and warehouse employees, as well as Amazon-owned Whole Foods’ workers, the company employs more than 1.3 million people in the US. The petition calls for eight hours of paid time off to be made available to employees to use up until election day for voting-related activities such as registering to vote and volunteering.
An Amazon spokesperson said: ‘We have supplied all of our employees with information on how to register to vote, details of their local polling locations and how to request time off to vote. In all 47 states with in-person voting, employees that lack adequate time before or after their scheduled workday to vote can request and be provided excused time off. The number of hours and pay provided to employees varies by state in line with local laws.’
– Starbucks said it is starting a mentorship program, hiring outreach workers for its cafes and tying team diversity to executive compensation as part of its broader plan to improve inclusion and become a more diverse company, CNBC reported. The company aims by 2025 to have employees who identify as black, indigenous or people of color make up at least 30 percent of workers at all corporate levels, from managers to senior executives. The company will be setting annual targets based on retention rates.
‘We hope we can influence other companies to follow our leadership or join in as well,’ said Starbucks COO Roz Brewer.
– According to the WSJ, corporate boards may soon be looking for fresh technology expertise as digital business models pursued in the wake of the coronavirus pandemic reshape business strategy. Companies over the past several months have moved forward with investments in artificial intelligence-enabled analysis of business data, automation and new forms of digital collaboration. The moves, aimed at business continuity, are taking on more permanent status as processes change across industries.
Enterprise-technology leaders and industry analysts say such changes would be difficult to achieve quickly without an established digital strategy and effective technology leadership, areas that boards must incorporate quickly.
– The WSJ reported that surging US unemployment claims are magnifying unemployment insurance fraud as a compliance risk for financial institutions. The US Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN) issued an advisory alerting banks to red flags that could indicate illicit activity, such as emerging schemes exploiting vulnerabilities created by the pandemic. According to FinCEN, US authorities and financial institutions have spotted instances of fraud related to unemployment payments.
Raymond Dookhie, a managing director at compliance advisory firm K2 Intelligence, said unemployment insurance is a prime target for fraudsters, given the high volume of people who have lost their jobs due to the pandemic. ‘The financial systems that are set up to monitor fraud in this current environment are being overloaded,’ he said.
– Ford Motor Co said former US ambassador to Russia Jon Huntsman will rejoin the company’s board of directors, Reuters reported. Huntsman was first elected to Ford’s board in 2012 but resigned in September 2017 to take on the ambassador role, a position he held for two years. He will be a member of the board’s compensation, nominating & governance and sustainability & innovation committees.
– According to Reuters, Federal Communications Commission (FCC) chair Ajit Pai said the agency will set new rules to clarify the meaning of a key legal protection for social media companies. President Donald Trump in May directed the US Department of Commerce to file a petition with the FCC seeking to curb legal protections for social media companies over a provision known as Section 230. Pai said the FCC’s general counsel said the agency ‘has the legal authority to interpret Section 230.’
Pai stopped short of outlining specific ideas or saying whether he would propose narrowing social media companies’ legal protections that could jeopardize existing business models.
Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
