August 11, 2022 | Editor: Martin Wennerström
At Tesla AGM, ESG proposals fall short of goal line
Tesla’s August 4, 2022, AGM rejected seven shareholder proposals addressing: reporting on anti-harassment and discrimination efforts, board diversity reporting, employee arbitration, lobbying reporting, freedom of association and collective bargaining, child labour reporting, and water risk reporting. Despite the proposals being invariably opposed by the board, most of them did achieve over 30% support from shares represented at the meeting. Meanwhile,the AGM rejected two management proposals concerning the reduction of director terms from three to two years and the elimination of the requirement that bylaw amendments be supported by two thirds of outstanding share capital. While these resolutions did achieve close to 100% support among votes cast, they were rejected for the second consecutive year precisely because they narrowly failed to garner this requisite supermajority among outstanding shares, of which around 40% were either entirely unrepresented at the meeting or appeared as broker non votes.
Euronews | Bloomberg | Market Watch | Tesla (1) | Tesla (2) | Tesla (3) |
AXA to repurchase up to EUR 1 billion in stock
French insurance firm AXA will repurchase up to EUR 1 billion of its shares as part of a share buyback scheme approved by shareholders at the 2022 AGM. The announcement followed the release of the insurer’s underlying earnings of EUR 3.9 billion for the first half of 2022. The repurchase is expected to be completed by February 2023, with the price being determined based on the volumeweighted average share price. Notably, at the beginning of the year, the insurance firm had already completed the repurchase of stock worth EUR 1.4 billion as part of a share buyback program announced last year.
City AM | Reuters | AXA (1) | AXA (2)|
Softbank raises cash by cutting Alibaba stake
SoftBank has announced the early physical settlement of prepaid forward contracts on around a third of its Alibaba shares. The contracts have raised approximately USD 22 billion for Softbank since it began issuing them in 2016. The settlement will decrease Softbank’s share in Alibaba from circa 24% to 15%. Softbank justified its use of derivatives as a means of minimizing the share price disruption from the sales. In addition, this method allowed Softbank to retain its board seat, which is contingent on it maintaining a 15% stake.
Bloomberg | CNBC | Fortune | Softbank (1) | Softbank (2) | Softbank (3) | Reuters |
New Zealand establishes Corporate Governance Institute
New Zealand's Exchange has announced that it will establish a new institute for corporate governance. Starting in 2022, the “NZX Corporate Governance Institute” will support the Exchange through the development of governance recommendations and rules for issuers on the NZX Main Board. The institute will function for a temporary period of one year and will become permanent upon a review of its effectiveness. The establishment of the institute has been subject to a public comment period alongside a proposed update of the NZX Corporate Governance Code.
Governance in Brief – June 1, 2023
Citigroup to IPO Banamex after Mexican gov’t interventions hamper sales deal Citigroup has announced a plan to spin off its Mexican business, Banamex, after a failure to sell the unit to conglomerate Grupo Mexico. Citigroup had been in talks with German Larrea, CEO and Chairman of Grupo Mexico, for over a year in an attempt to orchestrate the sale of the bank, which was first announced at the start of 2022.
Governance in Brief – May 25, 2023
Activist investor pushes for leadership and strategy changes at NRG Energy Activist investor Elliott Investment Management has disclosed a 13% stake in the US-based NRG Energy and called for leadership and operational changes at the company to remedy its “meaningful underperformance.” The investor urged NRG to add independent directors with experience in the power and energy sector to its board, noting that it has already identified five executives to guide the operational and strategic changes.
Governance in Brief – May 19, 2023
EU court sides with Ryanair on Lufthansa’s 2020 bailout. The EU General Court, the second-highest court in the EU, has annulled the European Commission’s decision on the approval of state bailout for Deutsche Lufthansa prompted by the 2020 pandemic. The judgment found the EC erroneously considered that Lufthansa could not obtain financing on the markets and failed to ask for the implementation of an incentive mechanism for the airline to buy back the German Government’s stake.
Governance in Brief – May 11, 2023
JPMorgan Chase takes over failed First Republic Bank JPMorgan Chase has acquired the assets and deposits of First Republic Bank after California authorities seized and auctioned the troubled lender. The Federal Deposit Insurance Corporation (“FDIC”), an independent governmental agency established to maintain financial stability through the insurance of banks’ deposits, took possession of First Republic Bank after the lender suffered a severe liquidity crisis following the failure of SVB and Signature Bank earlier in March.