– The Guardian reported that California state Senator Hannah-Beth Jackson has co-authored a bill mandating greater gender equality in the boardroom in an effort to avoid cultures of sexual harassment flourishing at the top of businesses. California Governor Jerry Brown must decide whether to sign the bill into law before the end of the month. ‘It’s my firm belief that with more women on these corporate boards this behavior will stop, and will not be allowed,’ Jackson said. ‘Boards now understand the impact of this behavior, how negative it is to the workforce, and how it impedes female workers and executives from doing the best job they can do.’
The California bill would require public companies headquartered in the state to place at least one woman on their board by the end of 2019. It also demands that two women must sit on publicly listed boards with five members, and three on boards of six or more by 2021. As of June 2017, more than a quarter of the 445 publicly traded companies in California had no women on their boards.
– According to The New York Times, the pace of corporate share repurchases is gaining momentum. Companies in the S&P 500 bought back a record $189.1 billion of their shares during the second quarter, up nearly 60 percent from a year ago, according to S&P Dow Jones Indices. The previous high was $178 billion, set during the first quarter. Corporate buybacks in the first six months totaled $379.7 billion, a 50 percent increase from the same period in 2017. Technology companies were the busiest, accounting for nearly $37.5 percent of the activity.
– German economy minister Peter Altmaier defended the government’s efforts to protect some firms from foreign takeovers, arguing that the state had a responsibility to protect key technology and certain industrial sectors, Reuters reported. ‘Germany will remain the most open and most liberal country when it comes to mergers’ but the government was considering stricter takeover rules, Altmaier said.
The government must be able to have a closer look at who wants to buy parts of Germany’s critical infrastructure, and senior officials are working on changes to foreign trade regulations to ensure key technologies remain in German hands, he added.
– The Wall Street Journal reported that Alun Milford, general counsel for the UK’s Serious Fraud Office (SFO), will leave the agency to become a partner at Kingsley Napley in early 2019. Milford is departing after more than six years as the agency’s general counsel. The SFO’s new director Lisa Osofsky arrived in early September, replacing David Green, who left the post at the end of a six-year term. Milford said in a statement that the ‘time is right’ for a move. ‘It has been a privilege to serve as the SFO’s general counsel and I have very much enjoyed the variety and challenge of the work,’ he said.
– CNN Money reported that Richard Parsons, who joined the CBS board earlier this year, has become ‘interim chairman’. The move was unanimously approved by the board of directors. ‘I think I speak for all board members when I say I look forward to learning more about CBS’ compelling opportunities and how we can help guide and support the company’s growth,’ Parsons said in a statement.
CBS CEO Les Moonves stepped down after two stories by The New Yorker’s Ronan Farrow alleged incidents of sexual misconduct in his past. Moonves called the allegations ‘untrue’ and suggested that the claims were made ‘as part of a concerted effort by others to destroy my name, my reputation and my career.’
– American Outdoor Brands shareholders backed a proposal urging the top US firearm maker to do more to address gun violence, the WSJ reported. The proposal asks the maker of Smith & Wesson guns to track shootings involving its products and consider investing more in technology to prevent their unauthorized use. Nearly 70 percent of investors in Sturm Ruger & Co backed a similar shareholder proposal at that company in May.
American Outdoor said it would prepare the required report by February but made no further concessions to investors that have won backing from some large fund managers. American Outdoor CEO James Debney said at Tuesday’s AGM that he was ‘disappointed’ by the vote. The company had said illegal use of its guns was a law-enforcement issue.
– As lawmakers consider whether tech companies should be regulated, SurveyMonkey CEO Zander Lurie said it is Silicon Valley’s responsibility to protect consumers’ data, according to CNBC. ‘We pay great heed to our customers’ data,’ Lurie said Wednesday ahead of the online survey company’s first trading day on Nasdaq. ‘We all have to be on the forefront.’
Lurie said SurveyMonkey handles more than 20 million answers from more than 3 million people every day, and that it complies with the EU’s General Data Protection Regulation.
– According to Reuters, the Bank of England (BoE) said only a small fraction of banks in the UK are planning properly to mitigate risks to their businesses from climate change, adding that the central bank would push lenders to take action. The BoE said it would consult with banks to show what it expected them to be doing and said bank directors had to engage on climate change and the shift to a low-carbon economy.
BoE governor Mark Carney, who has pushed climate change issues to the center of the bank’s regulatory mission, said banks had failed to grasp the scale of the challenge. The BoE said just one in 10 banks in a survey it conducted covering 90 percent of the industry were managing climate change risks with long-term, comprehensive plans.
– The WSJ reported that Merck & Co CEO Kenneth Frazier will continue in the role after he turns 65, after the company’s board decided to no longer require the CEO to retire at that age. Lead board director Leslie Brun said in prepared remarks that ‘removing the mandatory retirement policy enables the board to make the best decision concerning the timing of that transition.’
– Reuters reported that Uber Technologies settled with all 50 US state attorneys over a data breach the company failed to disclose in 2016. The attorneys general said Uber will pay a fine of $148 million, to be distributed in varying amounts across the states and Washington, DC. The breach exposed personal data from around 57 million accounts, including 600,000 driver’s license numbers. The terms of the settlement include changes to Uber’s business practices to prevent future breaches and reform its corporate culture.
‘We know that earning the trust of our customers and the regulators we work with globally is no easy feat,’ Uber chief legal officer Tony West said. ‘We’ll continue to invest in protections to keep our customers and their data safe and secure, and we’re committed to maintaining a constructive and collaborative relationship with governments around the world.’
– Rite Aid said it would overhaul its board of directors, a month after it dropped its merger with grocery chain Albertsons, according to CNBC. The company said it is separating the CEO and chair position: director Bruce Bodaken will become chair and John Standley will remain CEO. Rite Aid also nominated three independent directors – Robert Knowling, Louis Miramontes and Arun Nayar – to the board. Shareholders will vote on the proposed changes at next month’s meeting.
‘While we have important work ahead of us, we also have full confidence in our strategy, our team and our company to succeed in building significant momentum for the future as we continue to work to meet the evolving needs of our customers and create value for our shareholders,’ Standley said.
– The WSJ said that, according to a study by compliance services provider Fenergo, sanctions violations accounted for 56 percent of all fines handed out by regulators around the world in the past 10 years. The US authorities accounted for 91 percent in value of the $26 billion in penalties levied since 2008 for anti-money laundering (AML), sanctions and know-your-customer breaches, the firm found.
Penalties for violations of AML controls were more prevalent in Europe and the Asia-Pacific region, with the UK’s Financial Conduct Authority the most active enforcer in Europe. European regulators imposed 83 fines with financial penalties worth $1.7 billion in the past decade.
– The Guardian reported that the SEC sued Tesla CEO Elon Musk for fraud over the company’s aborted plans to take the electric car company private. The SEC and the US Department of Justice have been investigating after Musk suggested in August he was preparing to take Tesla private and claimed he had ‘funding secured’. The SEC said: ‘This statement was false and misleading. Over the next three hours, Musk made a series of additional materially false and misleading statements via Twitter.’
Musk said in a statement: ‘This unjustified action by the SEC leaves me deeply saddened and disappointed. I have always taken action in the best interests of truth, transparency and investors. Integrity is the most important value in my life and the facts will show I never compromised this in any way.’ Tesla and its board told CNBC they were ‘fully confident’ in Musk after the lawsuit was filed.
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...
