The week in GRC: QB Kaepernick joins Medium’s board, and Covid-19 privacy bills face hurdles
– CNN reported that Nike is adding June 19, a holiday known as Juneteenth, to its list of official, paid company holidays. Twitter, Square and Vox Media have also recently made Juneteenth, the oldest-known US celebration of the end of slavery, an annual company holiday. Nike CEO John Donahoe made the announcement in a letter to employees, along with several other actions the company plans to take following widespread demonstrations calling for racial justice.
‘At Nike, we aspire to be a leader in building a diverse, inclusive team and culture. We want to be better than society as a whole,’ wrote Donahoe in the letter. Among other things, he said Nike’s board and executive team plan to set targets for diversifying the company’s workforce, with a focus on increasing the number of black, Latinx and women employees. He said the company intends to track and measure its progress.
Companies’ acknowledgment of Juneteenth is a good first step, said Meredith Clark, an assistant professor of media studies at the University of Virginia. ‘I’m never going to frown at a company recognizing a day that is culturally important to so many Americans, really to all of us,’ she said. ‘But at the same time I want to see that sort of action matched with commitment to changing the culture inside these organizations.’
– According to The Wall Street Journal, the French Ministry of Justice has sent a memo to prosecutors outlining how it intends to investigate and prosecute illegal bribes paid by French companies to secure business overseas. The techniques and tools described in the memo closely resemble the ones used for nearly two decades in the US, where prosecutors have tried to encourage companies to detect and voluntarily disclose allegations of FCPA violations and reward those that do with more lenient settlements.
The memo even hints that French prosecutors may do what many in the country have found controversial about the US approach, by prosecuting foreign companies for misconduct in countries outside of France, even if such companies have only vague links to France.
– Laurentian Bank of Canada said CEO François Desjardins will retire on June 30 after 29 years with the company, Reuters reported. The bank said Stéphane Therrien, executive vice president of personal and commercial banking, will take over as interim president and CEO. The bank said its board has established a special committee to immediately undertake the search for a new president and CEO.
– The WSJ noted that, with authorities and companies looking into surveillance tools to fight the coronavirus and reopen the economy, many federal lawmakers agree that privacy protections are key but proposed safeguards face familiar hurdles in the US Senate. Many Republicans want federal law to override state-level rules for privacy, but Democrats say tougher state statutes should apply and want individuals to be able to sue companies for privacy violations.
Momentum for a general federal privacy standard gathered late last year when Republicans and Democrats discussed respective proposals in the Senate Commerce Committee. But unresolved differences re-emerged last month in separate bills aimed at data collection around the pandemic, leaving some observers doubtful the bills will move forward.
– According to CNBC, Marvin Owens, senior director of economic programs for the National Association for the Advancement of Colored People (NAACP), said investing for social advocacy could get a meaningful boost as the Black Lives Matter movement gains momentum and Wall Street recognizes there’s more to be done to increase diversity. Owens is co-creator of the Impact Shares NAACP Minority Empowerment ETF, a unique fund focused on racial and ethnic diversity.
The NAACP has been scoring companies for at least 25 years based on factors such as C-suite hiring, supplier diversity and community engagement, Owens said. Now it shares that data with Impact Shares and Morningstar to help shape its portfolio. All of Impact Shares’ net advisory fees go to the NAACP. The best information on racial and ethnic empowerment comes from companies that regularly report their data, Owens said, which is why the NAACP ETF’s portfolio resembles that of many other ESG funds.
– CNN noted that the number of women running Fortune 500 companies has become even smaller with the stepping down of Lockheed Martin CEO Marillyn Hewson after seven and a half years in the job. It was a planned transition announced in March and she becomes executive chair of the board. James Taiclet, formerly head of American Tower Corp, takes over as CEO.
– The Guardian reported that the Aunt Jemima pancake products brand will change its name and image in an effort to distance itself from racial stereotypes. The logo of the well-known brand features an African American woman named after a character from minstrel shows from the 19th century. ‘We recognize Aunt Jemima’s origins are based on a racial stereotype,’ stated Quaker Foods North America, a unit of PepsiCo that owns the Aunt Jemima brand, in a statement obtained by NBC news.
The company has long been criticized for the logo and name of its product and made the announcement as Black Lives Matter protests against racism in the US grow amid anger following the killing of George Floyd. ‘As we work to make progress toward racial equality through several initiatives, we must also take a hard look at our portfolio of brands and ensure they reflect our values and meet our consumers’ expectations,’ Quaker said, adding that the new packaging will be introduced in fall 2020 and a replacement name will be introduced later.
– According to the WSJ, PG&E Corp pleaded guilty to 84 counts of manslaughter for its role in sparking California’s deadliest wildfire, becoming one of the few US corporations to be convicted of homicide-related charges. The plea came on the same day a separate judge said he would clear the way for the company to exit bankruptcy.
PG&E CEO Bill Johnson entered the guilty pleas for each of the felony counts of involuntary manslaughter, looking at the images of the 84 victims on a screen. Johnson, who joined PG&E last year and will step down as its CEO this month, also pleaded guilty on the utility’s behalf to one count of unlawfully causing a fire. The company has agreed to pay the statutory maximum penalty of $3.48 million.
‘No words from me can ever reduce the magnitude of that devastation or do anything to repair the damage, but I sincerely hope the actions we’re taking today will help bring some measure of peace,’ Johnson told the court.
– Amazon.com launched an artificial intelligence-based tracking system to enforce social distancing at its offices and warehouses to help reduce risks of its employees contracting Covid-19, according to Reuters. The company faces intensifying scrutiny from US lawmakers and unions over whether it is doing enough to protect staff from the coronavirus.
The system, called Distance Assistant, uses camera footage in Amazon’s buildings to help identify high-traffic areas. Monitors set up in the company’s warehouses will also highlight workers keeping a safe distance in green circles, while workers who are closer together will be highlighted in red circles, Amazon said.
– The WSJ said small and mid-size companies are facing a growing number of cyber-attacks taking place largely out of public view, a trend that in turn creates an underappreciated risk for the bigger companies using their services. Analysts documenting the activities of increasingly savvy cyber-criminals say they are targeting lesser-known companies, particularly those that are closely linked with big, influential firms. In doing so, attacks can cause disruption far beyond the specific hack.
– Medium CEO Ev Williams said free-agent National Football League quarterback Colin Kaepernick is joining the company as a board member and will publish his own blog on the site on racism and civil rights, CNBC reported. ‘I am excited for Kaepernick Publishing to partner with Medium to continue to elevate black voices in the news and publishing industry,’ Kaepernick said in a statement. ‘I also look forward to creating new opportunities and avenues for black writers and creators with my new role as a board member.’
– The SEC named Jennifer Leete as associate director in the agency’s division of enforcement, succeeding Antonia Chion, who retired from the agency in February 2020. In her new role, Leete supervises roughly 50 attorneys, paralegals and staff responsible for investigating a wide variety of securities law violations. She joined the division as a staff attorney in 1999. In 2003 she became a branch chief and was promoted to assistant director in 2010.
– The White House said President Donald Trump intends to nominate Caroline Crenshaw to fill a Democratic SEC vacancy, Reuters reported. Crenshaw, a senior SEC attorney, would fill a commissioner seat that has been vacant since February, when Rob Jackson, whom Crenshaw advised, left to return to his teaching post.
If confirmed by the Senate, Crenshaw would balance the commission, where there are currently two Republican members and one Democratic member, Allison Herren Lee. The SEC is chaired by Jay Clayton, an independent who frequently votes with Republicans. Crenshaw declined to comment on the nomination.
– According to CNBC, Hertz decided to terminate a planned stock sale of up to $500 million after the SEC criticized the company’s plans. The decision ended debate about whether a bankrupt company such as Hertz should be allowed to sell shares that could ultimately end up being worthless. The company said in an SEC filing that the finance committee of Hertz’s board of directors ‘determined that it was in the best interests of the company to terminate’ the sale.