Key Governance Developments - June 2022

Key Governance Developments

Shareholders back McDonalds in animal welfare dispute with Icahn

Shareholders have backed fast-food chain McDonald’s in its dispute with investor Carl Icahn over animal welfare. Icahn had tried to get two nominees elected to the board to ensure the company complied with a long-standing promise not to buy meat from suppliers who rear pigs in crates. However, shareholders have re-elected all of the group's current directors.

Best source: Reuters (registration required)

Missed ESG goals represent operational and financial risk for companies and investors: study

Companies that miss their ESG targets face increased operational and financial risks, rather than just reputational damage, according to a survey by Dun & Bradstreet. Negative ESG performance on the part of companies as well as their suppliers, partners and distributors has had a negative effect on business for 81% of respondents. Achieving sustainability targets allows companies as well as investors to identify growth opportunities earlier and increase revenue and profit, according to the data and analytics firm.

Best source: Environment Analyst

Generali shareholder quits board after failure of bid to replace management

Italian businessman Francesco Gaetano Caltagirone has quit the board of insurer Generali after backing a failed bid to unseat CEO Philippe Donnet. It is the second time Caltagirone has resigned from the board over disagreements about the strategic direction of the group. Caltagirone is Generali’s second-largest shareholder with a 9.95% stake but is not expected to dispose of his holding.

Best source: Financial Times (subscription required)

ECB finds smaller banks demonstrate shortcomings in board governance

Bank supervisors at the European Central Bank have concluded that smaller institutions often demonstrate shortcomings in governance and board supervision of day-to-day activity. Some banks raise considerable doubt about the expertise on their boards, according to a survey of more than 200 institutions in 21 countries conducted by the ECB and the Banca d'Italia, demonstrating a need to strengthen governance. The ECB is responsible for directly supervising 111 large banks, but also oversees supervision of smaller institutions by national regulators.

Best source: Börsen-Zeitung (subscription required, in German)