US Republicans continue their assault on shareholder rights and ESG

The US House of Representatives last week voted on a series of proposals designed to dismantle key aspects of Dodd Frank reforms. After June’s vote to propose regulation of proxy advisors and rescind the conflict minerals rule, the latest intervention on watering down shareholder rights and ESG removes:
  • the SEC’s authority to enforce the CEO median pay ratio disclosure rules;
  • the ability for the SEC to mandate companies disclose material climate-change risks; and
  • the ability for SEC to give shareholders voting by proxy the ability to vote for a mix of of management and opposition board candidates on the same “univeral ballot card”.
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Investors have role to play in tackling forced labour

Investors need to engage more effectively with companies on forced labour and ensure that firms are meeting reporting requirements according to the latest Investor Briefing by pressure group, ShareAction.

The briefing includes examples of shareholder engagement with companies as well as policy makers which has led to action being taken against the use of forced labour by suppliers.… Read the rest

As board diversity stalls, new push to breakdown barriers and improve pipeline

After the initial push to increase board diversity over the past five years, progress appears to have slowed according to two reports published by the UK government and Cranfield School of Management.

The UK government has therefore launched a review focusing on increasing female representation to 33% of boards across the FTSE 350 by 2020.… Read the rest

Investors have a role in tackling UK’s low productivity

Tackling low business productivity levels since the 2008 financial crisis and recession requires more long-term thinking from investors according to the report  How Good is Your Business Really? Raising our ambitions for business performance published last week by the UK’s business-led Productivity Leadership Group (PLG).… Read the rest

MEPs back new lead for Capital Markets Union

The European Parliament’s Committee on Economic and Monetary Affairs has backed the decision by European Commission President Jean-Claude Juncker to transfer the EU’s financial stability, financial services and capital markets union portfolio to the Commission’s Vice-President Valdis Dombrovskis. This follows the resignation of the British Commissioner Jonathan Hill after the UK’s referendum result which was in favour of leaving the EU.… Read the rest

HBOS & BHS audit investigations launched

The UK’s Financial Reporting Council (FRC) has launched two separate audit investigations,one into KPMG’s audit of HBOS in 2007 and secondly PricewaterhouseCoopers audit of BHS in 2014 – under its accountancy scheme which it allows it to take disciplinary action against members of the profession.… Read the rest

UK executive pay reforms drove reputation management study finds

The initial response of the top UK companies to new reporting requirements was not to curb executive pay or improve the link CEO pay and firm performance at FTSE 100 companies, but led instead to “opportunistic reporting for the sake of reputation management,” says a study from Cambridge Judge Business School and King’s College London.… Read the rest

Sustainability needs to move into the mainstream business and climate summit told

The Paris climate change agreement has mobilised business and investors to take more action to reduce carbon emissions but to get the estimated $5 trillion a year of investment needed to move to a low carbon economy there needs to be a shift in thinking so that sustainable investment becomes part of mainstream investment speakers at the recent business and climate summit in London said.… Read the rest

Volkswagen settles with US authorities and diesel car owners

German car manufacturer Volkswagen (VW), which last year admitted to falsifying emissions data in its diesel cars around the world, has reached a $10.03 billion settlement with US authorities and former and current diesel car owners.

If approved by US regulators, VW has agreed to buy back cars, terminate lease deals or modify cars for free.… Read the rest

Companies globally are missing out on human capital

Countries – and therefore the companies within them – are missing huge opportunities when it comes to making the most of their populations’ economic potential, with only 65% on average of the world’s talent being optimised during all stages of the working life time, according to the World Economic Forum’s (WEF) Human Capital Report 2016.… Read the rest