Record number of abortion proposals filed
There is an “unprecedented wave” of abortion-related shareholder proposals filed for this year’s AGM season, reports the FT. This follows the landmark Roe vs Wade Supreme Court ruling last year, which overturned the right to abortion in the US.
A record number of US companies — including American Express, HCA Healthcare and pharmaceutical giant Eli Lilly — face shareholder demands for more details about the risks that US-state and federal abortion policies will have on the companies, as well as their employees’ rights.
With 10 companies already targeted, and over a dozen more proposals expected in coming weeks, it’s clear the Supreme Court’s decision has fuelled a fire in activist investors.
The volume of abortion-related shareholder proposals this year “is definitely unprecedented”, said Jackie Cook, director of stewardship at Morningstar’s Sustainalytics division.
However, companies are clearly keen to sidestep one of America’s most contentious political issues. At least four have asked the Securities and Exchange Commission (SEC) to block abortion shareholder proposals at 2023 annual meetings — including HCA healthcare and Eli Lilly — in which investors want greater clarity over what circumstances the companies offer abortion.
Apple’s CEO pay is cut after shareholder revolt
Crunch time for Apple CEO Tim Cook, who will see a chunk cut from his pay in 2023 to $49 million in total compensation.
An SEC filing from Apple reported that Cook himself asked for this change, following a shareholder vote on his pay package. Indeed, in last year’s “say-on-pay” vote, 64% of shareholders approved Cook’s compensation which was down from the 95% approval for Apple’s 2020 fiscal.
CNBC reports that in 2022, Cook made just under $83 million in stock awards, $12 million in incentives, and $3 million in salary. He also received benefits including pension contributions, security, personal air travel, and over $46,000 in vacation cash-out.
Reality bites.
Former McDonald’s boss served a Big Fat fine
The SEC has charged former McDonald’s CEO Steve Easterbook with a $400,000 fine for misleading shareholders and failing to disclose improper relationships during his firing in 2019.
Easterbrook was fired for an inappropriate relationship with an employee that violated the company’s “fraternization” policy. But he wasn’t fired for cause, which meant he could receive severance pay.
However, McDonald’s later discovered through an internal investigation that Easterbrook had engaged in other improper relationships with McDonald’s employees. According to the SEC’s order, Easterbrook knew or was reckless in not knowing that his failure to disclose these additional violations of company policy prior to his termination would influence McDonald’s disclosures to investors related to his departure and compensation.
“When corporate officers corrupt internal processes to manage their personal reputations or line their own pockets, they breach their fundamental duties to shareholders, who are entitled to transparency and fair dealing from executives,” said Gurbir S. Grewal, Director of the Division of Enforcement.
Misleading shareholders? SEC’s not lovin’ it.
Be prepared: The Disney boardroom battle has begun
Reuters reveals that the “battle for the board seat” at Walt Disney has begun with activist investor Nelson Peltz formally demanding a seat at the entertainment giant’s top table. He claims he wants to rescue Disney from a so-called “crisis” of wasting money on streaming products, buying 21st Century Fox, and failing to prepare for leadership succession.
Billionaire and activist investor Peltz is known for shaking up consumer businesses and poses a serious challenge to Disney CEO Bob Iger, who recently returned from retirement to lead the company for the second time.
Peltz owns a 0.5% or £750 million stake in Disney, through his investment fund Trian Partners.
Let’s see how far he’ll go.
