– CNN reported that HSBC CEO John Flint is stepping down after less than two years in the role. The bank said in a statement that Flint resigned by mutual agreement with the board, adding that change is needed to meet ‘the increasingly complex and challenging global environment’ the bank faces. HCBC said it is considering internal and external candidates to succeed Flint. Noel Quinn, head of global commercial banking, will be acting CEO.
– Ten US senators urged Google to take ‘immediate action’ to switch its growing number of contractors to full-time employees after six months of work, according to CNBC. ‘Temporary workers and independent contractors are by definition intended for short-term and non-core work, and we urge Google to end any abuse of these worker classifications and treat all Google workers equally,’ the letter, which was addressed to Google CEO Sundar Pichai, said.
The letter is signed by Democratic senators Sherrod Brown, Patty Murray, Benjamin Cardin, Brian Schatz, Elizabeth Warren, Kamala Harris, Edward Markey, Richard Blumenthal, Richard Durbin and Bernie Sanders, who is an independent but caucuses with the Democrats.
Google disputes the arguments raised in the letter. ‘We are proud to create economic opportunities for both the people we employ directly and our extended workforce of vendors, temporary staff and independent contractors, and believe that our practices in this regard accord with the highest industry standards. Respectfully, we strongly disagree with any suggestion that Google misuses independent contractors or temporary workers,’ according to a copy of a letter sent by Eileen Naughton, vice president of people operations, to the senators.
– Walmart said Monday that it will not stop selling guns or change its open carry policies, as advocacy groups and workers voiced concerns about shootings at two of its stores that killed 24 people in the previous, The Washington Post reported. ‘There has been no change in company policy,’ a spokesperson said. ‘With this incident just having happened over the weekend, our focus has been on supporting associates, customer and the El Paso community.’
The retail company sells guns in roughly half of its 4,750 US stores, making it one of the largest US sellers of firearms and ammunition. ‘We follow all federal, state and local regulations,’ the spokesperson said. He added, ‘you’re not going to see associates who are armed during their shifts.’ Walmart has gradually tightened its gun policies over the years. For example, it stopped selling assault-style rifles in 2015 and said it would focus instead on firearms for hunting and sports.
– According to Reuters, Nordic telecoms group Telia’s CEO Johan Dennelind resigned unexpectedly, having transformed the company’s strategy since taking the role in 2013. Under Dennelind’s leadership, Telia has withdrawn from nearly all of its central Asian markets, refocusing on its seven Nordic and Baltic operations, seeking new growth opportunities such as a push into television.
Dennelind, has given Telia 12 months’ notice. Board chair Marie Ehrling said Dennelind’s leadership had been crucial during the overhaul and that she and the board regretted his decision to step down. Dennelind will continue in his position for the time being and the exact timing of his departure depends on the recruitment of a successor, Telia said in a statement.
Dennelind said Telia is now entering a new phase with several opportunities for value creation and he has decided to leave to take on new challenges. ‘I will continue in my role to drive our current agenda forward with full focus and commitment for as long as the board wants,’ he added.
– The Wall Street Journal reported that Tyson Foods and other major chicken companies said they received subpoenas from the US Department of Justice (DoJ), indicating an expansion of an investigation into allegations they colluded to prop up prices. Tyson disclosed in a regulatory filing that it had received a grand jury subpoena from the DoJ seeking ‘documents and information related to the chicken industry,’ weeks after the agency disclosed a criminal investigation into the sector.
Pilgrim’s Pride separately disclosed in a regulatory filing that the DoJ had issued the company a subpoena related to the investigation. Perdue Farms received a similar subpoena and will co-operate with the request, a Perdue spokesperson said. A Pilgrim’s Pride spokesperson declined to comment further. Tyson said in the filing that it was co-operating with the DoJ request.
– Domino’s Pizza Group, holder of the master franchise agreement for Domino’s stores in the UK and Ireland, announced the retirement of CEO David Wild, according to Reuters. The company said a succession plan was underway, without giving further details. Domino’s had said in March that it was considering replacing its CEO and chair in the wake of the UK Financial Reporting Council’s revised corporate code that emphasizes the need for boards to refresh themselves, become diverse and plan properly for replacing top jobs.
– According to the WSJ, a handful of public companies have begun telling investors about how gun violence could affect their financial performance. Companies such as Dave & Buster’s Entertainment, Del Taco Restaurants and Stratus Properties, a Texas-based real-estate firm, added references to active-shooter scenarios in the ‘risk factor’ section of their latest annual reports, according to an analysis of SEC. The Cheesecake Factory has included it in its past four annual reports.
The disclosures come as fatalities in mass public shootings have risen in recent years. Between 2016 and 2018, active shooter incidents led to 306 deaths, according to the Federal Bureau of Investigation, up from the previous three years when active shooters killed 136 people.
‘People are legitimately trying to think through whether it’s responsible to put a risk factor like this in the document,’ said David Martin, senior counsel at Covington & Burling. The Cheesecake Factory and Stratus declined to comment. Dave & Buster’s and Del Taco didn’t immediately respond to requests for comment.
– The Financial Times said Apollo Global Management secured a victory over two dissident shareholders in its affiliated life insurance company Athene Holding when they withdraw New York lawsuits against the private-equity firm following pressure from a Bermuda court. At issue is a clause in Athene’s incorporation documents stipulating that certain disputes must be litigated in Bermuda, where it is registered. The case illustrates the legal obstacles facing shareholders with complaints about the growing number of companies that have incorporated overseas to trim their tax bills.
The plaintiffs recently withdrew their lawsuits, meaning New York courts will have no opportunity to rule on the claims. Apollo said the claims were ‘completely without merit and would fail in any jurisdiction,’ and called the dismissals ‘a routine application of Athene’s bylaws, which clearly provide that Bermuda is the proper forum for litigation.’ The plaintiffs in the Apollo lawsuits are free to pursue their complaints in a Bermuda court but they would have to finance the litigation themselves.
– Reuters reported that Elliott Management has dropped its bid for Denver-based QEP Resources and will instead work with the company to identify two board nominees. Elliott in January offered to buy the company for $2.07 billion. QEP said it will create a five-person operations committee, chaired by CEO Tim Cutt, that will include two existing independent directors and two new board members as part of the agreement with Elliott.
– According to the WSJ, International Flavors & Fragrances (IFF) disclosed potential bribes in Russia and Ukraine by an Israeli company it acquired last year. IFF said it discovered the allegations during the after-purchase integration of Frutarom Industries. The allegations concern two Frutarom businesses, which made potentially improper payments to a number of customers, IFF said in a regulatory filing.
After learning of the allegations, IFF alerted the DoJ, the SEC and Israel’s Ministry of Justice, according to a company spokesperson. IFF also launched its own investigations with the help of outside counsel and accounting firms. ‘We have committed to the highest standards of ethics and compliance and have strict compliance policies in place,’ IFF CEO Andreas Fibig said, adding that the company hadn’t uncovered evidence suggesting that the payments had any connections to the US.
– Reuters reported that the SEC proposed changing the rules governing how publicly traded companies disclose business, legal, and risk factors in regulatory filings in an effort to reduce their compliance burden. The proposal is intended to improve the readability of disclosures companies provide investors while discouraging companies from including repetitive or non-material information, the SEC said.
The proposed changes to so-called Regulation S-K are part of a broader effort by SEC chair Jay Clayton to modernize and in areas relax the agency’s regulatory regime for public companies.
– The WSJ said that the Committee of Sponsoring Organizations (COSO) of the Treadway Commission, a key standard-setter on internal controls, is preparing to publish a set of guidelines for companies on how to manage cyber-security and other enterprise risks. The new COSO guidance is expected to address how companies can apply the principles of enterprise risk management to protect against cyber-attacks; how to better craft risk-appetite statements; and how to better manage risk and compliance across an enterprise.
COSO chair Paul Sobel said the guidance will be rolled out later this year and early next.
Ben Maiden
Ben Maiden is the editor-at-large of Governance Intelligence, an IR Media publication, having joined the company in December 2016. He is based in New York. Ben was previously managing editor of Compliance Reporter, covering regulatory and compliance...
