The week in investor relations: Gender-neutral bylaws, a Russian boom and a push to protect the environment
– JPMorgan, the largest bank in the US, went gender-neutral when it changed its bylaws this week, reported Bloomberg. As pressure grows from both society and investors on global businesses to show they are diversifying and becoming more inclusive, the bank swapped the use of ‘chairman’ for ‘chair’ and also switched ‘his,’ ‘him’ and ‘her’ pronouns for non-gender-specific terms. It used ‘chief executive officer’ to replace ‘he’, for example, in its revised bylaws issued on March 16, said the news agency.
– Russian companies are cashing in on a global equity boom, leveraging growth potential and low valuations as investors largely ignore geopolitical risks and the risk of further sanctions on Moscow, analysts and bankers told Reuters. Russian gold miner GV Gold this week became the latest in a small flurry of companies from the country to announce an IPO. ‘There is an understanding that you need to look to emerging markets for returns and Russia, on average, is cheaper than many others,’ a senior banker working on Russian deals told the news agency. ‘And there is a feeling that political tensions are easing, so markets do not expect major sanctions.’
– BlackRock said it will push companies to step up their efforts on the environment, saying companies must act on deforestation, biodiversity loss and pollution of the oceans and freshwater resources, reported the Financial Times (paywall). In guidelines published on Thursday, the world’s largest asset manager said it was prepared to vote against the re-election of directors if companies had not effectively managed or disclosed risks related to the depletion of ‘natural capital’. The paper noted that BlackRock might also vote in favor of shareholder proposals that highlight natural capital risks.
– Reuters reported that Warren Buffett’s Berkshire Hathaway urged shareholders to reject proposals that annual reports be produced about Berkshire’s efforts to address climate change and promote diversity and inclusion. The proposals were disclosed in Berkshire’s proxy statement ahead of its May 1 AGM. Citing its decentralized model, Berkshire said the climate proposal from CalPERS, Federated Hermes and Caisse de dépôt et placement du Québec was unnecessary, and that many businesses’ climate decisions already made ‘great sense’ for the environment. The company also cited its business model and Buffett’s record of ‘opposing efforts, seen or unseen, to suppress diversity or religious inclusion’ in opposing the proposal on diversity from As You Sow.
– CFA Institute announced this week that it would offer a Certificate in ESG Investing, reported InvestmentNews. The organization, which grants the chartered financial analyst designation, said the certificate represents the first global qualification in the ESG investing process. The certificate focuses on analyzing ESG factors and integrating them into portfolios. It also provides ESG fluency for people working in functions such as sales and distribution, wealth management, product development, financial advice, consulting and risk.
– Reuters reported that Danone’s chairman and CEO Emmanuel Faber was being replaced immediately after the company bowed to pressure from activists. Faber has been ejected by the group’s board after the world’s largest yoghurt-maker faced growing calls from some shareholders to replace him. Faber became CEO in 2014 and had been pushing the company into healthy foods but Reuters said sales and margin growth had underperformed some rivals in recent years. Danone said Faber would be replaced immediately by recently appointed director Gilles Schnepp in the seat of non-executive chairman, while Veronique Penchienati-Bosetta, CEO for international, would work with Shane Grant, CEO for North America, as CEO and deputy CEO, respectively, on an interim basis.
– CNN reported that former Starbucks executive Rosalind Brewer assumed her new role as CEO of Walgreens, making her the only black woman currently serving as the head of a Fortune 500 company and just the third in history to do so. Today, there are only four African Americans serving as Fortune 500 CEOs, including Brewer. Kenneth Frazier has led Merck since 2011. There are also Lowe’s CEO Marvin Ellison and TIAA CEO Roger Ferguson, who is stepping down. JPMorgan Chase executive Thasunda Brown Duckett, a black woman, is set to replace Ferguson on May 1.
– The company behind Chinese social networking platform Soul App confidentially filed for an IPO in the US, according to Bloomberg, citing ‘people familiar with the matter’. The listing could happen this year, it said, with one person telling the agency the company’s valuation is more than $1 bn, though deliberations are apparently ‘at an early stage’, so there is no guarantee the company will continue with its listing plans. The app uses artificial intelligence to match like-minded people, allowing them to chat by text and voice, as well as participate in group chats and post to a public forum.
– According to The Wall Street Journal (paywall), some of Germany’s largest listed companies are facing a gender-diversity quota on executives. Under a draft of the regulation, which won cabinet approval this year and is now under debate in the German parliament, some companies would have to have at least one woman on their management board. The rule would apply to roughly 70 of the country’s biggest companies that meet the criteria, including around 30 that don’t have a female management board member, the Federal Ministry of Family Affairs, Senior Citizens, Women and Youth said this month.
– The FT reported that UK public companies would have to appoint a minimum number of diverse board members or face regulatory scrutiny under measures being considered by the Financial Conduct Authority (FCA). FCA chief executive Nikhil Rathi said premium listed companies must build more diverse boards. UK financial services companies more widely will also need to improve diversity at senior levels or face regulatory consequences, he added.