September 22, 2022 | Editor: Martin Wennerström
DOJ unveils crimefighting policies for corporate misconduct
The U.S. Department of Justice has announced a new “carrots and sticks” approach to fighting corporate crime that encourages companies to report misconduct while making it more difficult for repeat offenders to enter settlements and deferred prosecutions. The policies instruct prosecutors to ensure timely disclosure and prioritization of individual investigations and to consider the corporation’s history of misconduct and the extent of its voluntary disclosure. In addition, new evaluation metrics are to be introduced for the evaluation of compliance programs, including a determination of whether remuneration to current or former employees, executives, or directors is subject to clawbacks based on “actions or omissions [that] contributed to criminal conduct”. Finally, prosecutors should consider the degree to which compensation systems affirmatively incentivize compliance behaviour. Further guidance on the topic is expected by year-end.
Reuters | DOJ | JD Supra | WaPo |
EU General Court upholds Google antitrust fine
The General Court of the European Union has upheld a 2018 antitrust ruling by the European Commission against Google, while reducing the size of the resulting fine from EUR 4.34 billion to EUR 4.12 billion. The EC had levied the fine in response to the tech giant’s policies and practices surrounding the preinstallation of its browsing and search apps on smartphones. The decision occurs against the backdrop of the new EU Digital Markets Act, which will impose a new regulatory regime on several large U.S. tech giants. Google has previously been fined a total of EUR 8.28 billion over claims of anticompetitive behavior in 2017, 2018 and 2019.
Reuters | NYT | CNBC | Business Insider |
Twitter shareholders approve Musk deal amid ongoing lawsuits
Twitter shareholders have approved Elon Musk’s bid with a 98.57% majority, following a board recommendation in support of the deal. The USD 44 billion deal is nevertheless subject to ongoing legal wrangling, with Musk wishing to rescind his offer due to allegedly misrepresented userbase and spam account metrics, and Twitter wishing to hold Musk to the agreement. The dispute is set to be heard by a Delaware state court in an expedited trial that starts on Oct. 17 and that is expected to last five days, with Musk’s request to delay the trial until February 2023 having been denied.
SEC | Bloomberg | CNBC (1) | CNBC (2) | BBC |
Logistics magnate acquires Germany’s Lufthansa stake
Germany’s "Economic Stabilization Fund” has fully exited the Lufthansa stake that it acquired through its 2020 bailout of the airline, one year ahead of its October 2023 deadline. Most of the stake has been acquired by KlausMichael Kühne, making him the largest shareholder with a 17.5% stake that he amassed mostly over the past year. Kühne is expected to receive board representation, something that the 85- year-old logistics entrepreneur has previously coveted. The past year has seen several investments in airlines by freight operators seeking an alternative to increasingly congested land and sea routes.
Reuters (1) | Reuters (2) | Bloomberg | ABC |
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.
Governance in Brief – May 4, 2023
TotalEnergies sells Canadian oil sands operations to Suncor TotalEnergies has announced that it will sell its Canadian operations to Suncor Energy, in an agreement worth up to CAD 6.1 billion (USD 4.47 billion). The French energy giant had originally planned to exit Canadian oil sands by spinning off TotalEnergies EP Canada, but later agreed to instead sell the operations after having received unsolicited offers from both Suncor and other parties.