Diversity Moves Forward

Diversity Moves Forward

Locally, highlighted in its 12/29/17 Edition, The Long Island Business News heralded the election of Laura Curran as the new Nassau County Executive, a first for one of the most important counties in New York. In addition, Laura Gillen was elected as supervisor of the Town of Hempstead, followed by Madeline Singas as District Attorney and Geraldine Hart as Suffolk County Police Commissioner.

Highlights of the 2017 Proxy Season

Following a slowdown in activity in 2016 that was driven by volatility in the equity and commodity markets, 2017 promised to be a rebound year for activist activity.

However, the number of activist campaigns was relatively flat.

Could this be viewed as a sign of the decline of shareholder activism? 

Actually, we believe it demonstrates how shareholder activism has evolved from a niche strategy of a limited number of high-profile hedge funds to a widely accepted approach to investing pursued by institutional investors and hedge funds alike. Click to read full report

Good Grief!

After spending collectively an estimated $100 million in a costly proxy fight Proctor & Gamble and Trian have arrived at an accommodation.

As reported in The Wall Street Journal, after two independent vote recounts, Trian lost by 500,000 shares out of two billion cast.

Although P&G was the winner, it agreed to add Mr. Peltz of Trian to its board as of March 1st.

Could have broad director implications...

In a Sunday business section of The New York Timesthere was an article concerning the Wells Fargo mess, which has dragged directors and officers into a plaintiveslawsuit.

There are 15 current or former directors, and 4 current or former Officers - as named defendants.

The case is being heard in U.S. District Court in San Francisco by Judge Jon S. Tigar. Judge Tigar allowed the case to go forward by stating the directors had consciously disregarded an obligation to be reasonably informed about the business and its risks, or consciously disregarded the duty to monitor and oversee the business. As to the officers, “it is implausible” that Wells Fargo senior management ---- was unaware of the alleged fraud.

Questions if the plaintiffs prevail:

a. Does the D & O insurance cover this type of liability?

b. If so, is the insurance policy large enough to cover a settlement or award? If not, will the defendants be personally liable, as were the WorldCom directors who paid out close to 25 million dollars?

c. What impact will this have, if any, on the ability to recruit qualified personnel to fill a director’s seat?

This outcome of this case could change the dynamics between board members and a company’s Executive Suite!

Ref: The New York Times, Sunday, November 5, 2017