The week in GRC: Citi to require workers to be vaccinated and FTC adopts new M&A policy
– CNBC reported that business groups are urging the White House to delay President Joe Biden’s Covid-19 vaccine mandate for companies until after the holiday season, fearing it could cause an exodus of employees. Officials from the Office of Management and Budget have held dozens of meetings with labor unions, industry lobbyists and private individuals as the administration conducts its final review of the mandate.
Retailers are particularly concerned the mandate could trigger a spike in resignations that would exacerbate staffing problems at businesses already short on people, said Evan Armstrong, a lobbyist at the Retail Industry Leaders Association.
– The Guardian reported that, according to a new poll, most Americans want to see oil and gas companies held to account for lying about the climate crisis and contributing to global warming. The poll shows that the US remains sharply divided over the causes of the climate crisis following the fossil fuel industry’s efforts to downplay and deny climate science. That division falls largely along political lines, with Democrats and Republicans at odds over the source of climate disinformation.
The poll found that 70 percent of respondents said global warming was happening, and more than 60 percent said oil and gas companies were ‘completely or mostly responsible.’ But while Democrats overwhelmingly (89 percent) accept the scientific basis of climate change, opinion is split among Republicans: just 42 percent of Republicans agree that global warming is a reality while 36 percent deny it. The rest said they didn’t know.
– The Wall Street Journal reported that, according to a report from the United Nations (UN), the world’s emissions reductions plans would allow far more global warming than is targeted in the Paris climate accord, and some of the biggest emitters such as the US are not on track to hit their pollution targets.
The UN report analyzes all plans submitted under the Paris accord as of September 30, and those – such as China’s – that haven’t been submitted. It finds the measures detailed in those plans up to 2030 would still leave the world 2.7°C warmer by the end of the century. Countries ‘need to make their net-zero pledges more concrete,’ said Inger Andersen, executive director of the UN environment program, which wrote the report. ‘We are not doing ourselves a favor by kicking the net-zero plan down the road until 2050. We need to take action before 2030.’
– According to Reuters, law firms may differ on when to order attorneys back to the office, but many seem to agree that working in person doesn’t necessarily have to be full time. At Dechert, lawyers and staff will be encouraged to spend a minimum of one day a week working in person when the firm reopens its offices globally on November 8. ‘We realize some of our people still have concerns and we will continue to be flexible,’ a spokesperson said. The arrangement will be in place through the end of the year but could be extended, she said.
Paul Weiss Rifkind Wharton & Garrison is moving to a three-day-a-week return beginning November 1, according to a memo reviewed by Reuters. Gibson Dunn & Crutcher, which is planning to broadly return lawyers and staff to the office on January 4, 2022, said it won’t mandate any particular number of days.
– JPMorgan Chase said it has already committed $13 bn of the $30 bn in lending and spending it pledged last year for improving racial equity, the WSJ reported. In a progress report, the bank said it had issued $6 bn in loans that kept open affordable housing and rental units across the country and issued $1 bn in loans to build more. It said another $4 bn went into refinancing 16,000 mortgages for black and Latino borrowers.
The original plan called for $2 bn in new small-business lending and 40,000 home loans in minority communities. The bank didn’t specify its progress on those figures, though it reiterated the targets. To make those loans, it said it added branches to minority neighborhoods, created new jobs and is developing new loan products.
Many companies pledged money toward racial equity after George Floyd’s death and the protests that followed. Brian Lamb, JPMorgan’s head of diversity, equity and inclusion, said the bank is laying the groundwork to change how it does business.
– Reuters reported that Fox Corporation is continuing to expand its legal department by hiring former Kirkland & Ellis partner Stephen Potenza as deputy general counsel for Fox News Media. Potenza will report to Fox News general counsel Bernard Gugar, who was US head of industries for Google Cloud’s deal pursuit organization before taking on his Fox News role in April.
Before his move, Potenza had spent about half a decade at Kirkland, where he was a partner in the firm’s litigation and its government, regulatory and internal investigation groups. He joined Kirkland in 2016 when it absorbed his former firm, Bancroft, the litigation boutique founded by Kirkland alumnus Viet Dinh.
– According to the WSJ, Royal Dutch Shell CEO Ben van Beurden defended the energy company’s business model after activist investor Third Point called for the break-up of the company to improve its environmental and financial performances. Van Beurden said the needs of Shell’s customers and the company’s efforts to pivot away from fossil fuels were better served by keeping its range of assets and businesses. In particular, he said the company’s legacy oil-and-gas assets were needed to fund its investments in lower-carbon energy.
The activist’s demands bring to the fore a debate within the energy industry about how the world’s largest oil and gas companies should play the transition. Large oil companies are coming under growing pressure from investors, environmental groups and governments to accelerate their shift out of fossil fuels and increase investments in cleaner energy.
– According to CNN, Citigroup told staff that US-based employees will be required to get fully vaccinated if they want to stay employed. In a post on LinkedIn, Citi’s head of human resources Sara Wechter partially cited the Biden administration’s vaccine order for federal contractors, noting the US government is a ‘large and important client’ of the bank.
‘We have an obligation to comply with the executive order issued by the White House mandating that individuals supporting government contracts be fully vaccinated – an order that would impact the vast majority of our US colleagues,’ Wechter wrote. A Citi official said the bank is encouraging and incentivizing employees to submit proof of vaccination by December 8, including by offering a $200 ‘thank you’ to those who do.
– CNN also reported that a survey by Kaiser Family Foundation (KFF) found 37 percent of unvaccinated workers say they will quit their jobs if forced to either get vaccinated or take weekly Covid-19 tests. If their employer mandates vaccines and doesn’t offer the testing option, 72 percent of the unvaccinated workers say they will quit. If the surveyed unvaccinated workers follow through on their threats to quit, it would lead to between 5 percent and 9 percent of workers leaving their jobs, depending upon what rules they face.
‘What people say in a survey and what they would do when faced with loss of a job can be two different things,’ said Liz Hamel, vice president and director of public opinion and survey research at KFF, in an interview earlier this month ahead of the latest survey. Several major employers, including United Airlines and Tyson Foods, that have imposed vaccine mandates report that nearly all their workers have complied with the rules.
– According to the WSJ, the Federal Trade Commission (FTC), led by new Democratic chair Lina Khan, has adopted a series of policy changes aimed at clamping down on corporate mergers. The latest initiative came this week when Democrats who control the five-member FTC announced a policy that would give the commission veto power over a company’s future transactions once it attempts an allegedly anticompetitive merger or acquisition.
The new prior-approval policy will be included in legal settlements in which merging companies make concessions to resolve FTC concerns that their transaction would be anticompetitive. The commission in those agreements plans to prohibit companies from making future acquisitions in the same market – and possibly other markets – without its approval.