Governance in Brief – July 14, 2022

Posted on July 14, 2022

July 14, 2022 | Editor: Martin Wennerström 

Download PDF


SEC rescinds proxy advisory restrictions

The U.S. SEC has voted to rescind Trump-era rules covering proxy advisers, in a move that is meant to facilitate the “timeliness and independence of proxy voting advice.” Once the change comes into force, issuers would no longer be entitled to preview recommendations ahead of publication or to have their written responses automatically disseminated to proxy advisory clients. In addition, certain text relating to advisers’ liability for material misstatements and omissions will be stricken, reportedly to eliminate confusion while reaffirming that proxy advice is indeed subject to legal liability. Proxy adviser Institutional Shareholder Services has described the changes as insufficient, while industry group The National Association of Manufacturers has threatened suit to “protect manufacturers from proxy advisory firms’ outsized influence.”

SEC (1) | SEC (2) | SEC (3) | NAM | Reuters (1) | Bloomberg (1) | Bloomberg (2)|



GSK shareholders approve Haleon demerger

GSK shareholders voted to approve the spin-off of its consumer healthcare business, Haleon. The new company will begin its listing on the London Stock Exchange starting July 18, with an expected valuation of between GBP 38 to 45 billion. Earlier this year, GSK rejected Unilever’s GBP 50 billion purchase offer. Following the demerger, Pfizer will maintain its 32% stake, while GSK will own around 6% of its shares. GSK shareholders will own more than 54% of Haleon’s shares. Brian McNamara will continue as CEO, while GSK’s Chairman Dave Lewis will serve as non-executive Chairman. Two Pfizer-nominated directors will also join the board.

Guardian | Fierce Pharma | GSK|



Berkshire Hathaway increases its stake in Occidental Petroleum

Berkshire Hathaway has increased its stake in Occidental Petroleum to 18.7%, after starting to acquire shares in March 2022. The company could increase its ownership to 25% if it were to keep stock warrants representing around 9% of Occidental’s shares. Berkshire’s recent acquisitions of Occidental stock prompted speculations over Warren Buffett’s intention to acquire the oil company, however the company did not respond to inquiries regarding its purchases. If Berkshire were to increase its stake to more than 20%, it could consider a change in accounting and record the proportionate share of earnings in its own profits.

Reuters | Business Insider | S&P Global |



Orpea reshuffles board in wake of nursing home scandal

Orpea’s July 28 AGM will vote on the appointment of five new board members, including newly appointed CEO Laurent Guillot as director and former French state railway CEO Guillaume Pepy as board chairman. The changes come amid scrutiny over the eldercare home operator’s business practices, including allegations of neglect and a tiered rationing of services. According to the company, an external audit revealed evidence of financial misconduct while failing to substantiate all the allegations against the company. The care home firm also confirmed that French police raided its headquarters but declined further comment.

Yahoo | Reuters | Orpea (1) | Orpea (2) | HI |


Recent Content

governance in brief

Governance in Brief – December 8, 2022

EU Parliament approves directive boosting female board representation The European Parliament has approved a directive requiring the “underrepresented sex” to make up 40% of non-executive director roles or 33% of all director roles of publicly listed EU companies, excluding small and medium enterprises, by June 2026. According to the “Women on Boards” Directive, which was passed 10 years after it was first proposed by the European Commission, companies will have to annually report on board gender representation to authorities and, in case targets are not met, explain how they plan to attain them. Additionally, Member States will have to set up a penalty system, including fines or annulment of director selection, for noncompliant companies.

governance in brief

Governance in Brief – December 1, 2022

Intel changes performance metrics for CEO’s new-hire award Intel has amended the new hire agreement for CEO Pat Gelsinger by increasing the share price growth target from 30% to 50%, extending the post-grant vesting period from three to five years, and increasing the number of trading days during which target prices need to be maintained from 30 to 90 days. The decision comes after more than half of votes cast by shareholders at the 2022 AGM opposed the company’s remuneration report.

governance in brief

Governance in Brief – November 24, 2022

Costco to set new emissions targets following activist demands Activist investment firm Green Century Capital Management claims that Costco Wholesale Corp has pledged to set new Scope 3 climate reduction targets in 2023. At Costco’s January 2022 AGM, 70% of votes supported a proposal from Green Century for the company to include emissions from producers and distributors in its net-zero greenhouse gas emissions targets.

governance in brief

Governance in Brief – November 17, 2022

Renault to potentially spin off EV line and partner with Geely French carmaker Renault Group has announced plans to split its activities into five separate businesses: “Ampere” (electrical vehicles), “Power” (combustion- and hybrid-engine assets), “Alpine” (sports cars), “Mobilize” (financial services), and “The Future is Neutral” (recycling activities). The company is considering listing Ampere on Euronext Paris in 2023 and has said that it will welcome external investors while maintaining a “strong majority.”