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Georgeson Monthly Roundup - December 2020
north america
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Latest Georgeson publications

Georgeson memo on the Glass Lewis 2021 Policy Updates

On 24 November 2020, Glass Lewis released its guideline updates for its main voting policies for 2021. The updates will be effective from the 2021 AGM season and apply to all shareholder meetings thereafter.

Read more about the US and European updates.

EuropeanIssuers webinar on the Role of Corporates in Sustainable Finance

On 9 December 2020, Georgeson’s Head of Governance for UK & Europe, Daniele Vitale, joined a panel promoted by EuropeanIssuers to discuss ESG and sustainability reporting from an investor point of view.

You can watch the recording of the webinar here.

Webinar with Dan McCrum from the FT about Wirecard - available on demand now

Just a few days after Dan McCrum was awarded 'Journalist of the Year' in the UK for his investigation into German payments company Wirecard, our own Cas Sydorowitz had the honour of welcoming him for a live webinar to share his insights.

If you could not attend the live session, we invite you to watch the recording on demand.

Activist Insight's 2020 Adviser Awards

On 18 December, Activist Insight published their 2020 Adviser Awards. We are proud to have been ranked #1 in average market cap for both issuer and activist representations and #4 globally by number of mandates.

Take a look at the full rankings here.

Big shout out to Cas and team!

Shareholder Activism
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Pan-European developments
    • The Financial Times reports that Retail chiefs in UK earn among highest multiples of workers’ wages: https://www.ft.com/content/dc2bd052-bbf5-4aae-9821-870bea7c0fc3
      “Report comparing boardroom and shopfloor pay highlights yawning disparity in earnings.”

    • ESG Today reports that Church of England Investment Funds Divest From Climate Underperformers, Achieves Progress in Others: https://www.esgtoday.com/
      “The Church of England’s National Investing Bodies (NIBs), comprised of the Church Commissioners for England, the Church of England Pensions Board and CBF Church of England Funds announced the addition of nine companies to its restricted list, due to the companies’ failure to meet the standards of the NIBs’ 2020 climate change hurdles. The NIBs also announced that twelve companies avoided being added to the list due to positive changes, including setting emissions targets and improving climate-related disclosures and transparency.”

    • The Financial Times reports on Unilever to put its plans to fight climate change to shareholder votes: https://www.ft.com/content/a0814dc8-c662-4412-
      “First FTSE 100 company to offer shareholders recurrent say on efforts to address global warming.”

    • ESG Today reports that bp Announces Majority Stake Investment in Carbon Offset Developer Finite Carbon: https://www.esgtoday.com/bp-announces-
      “Energy company bp announced today that it has acquired a majority stake in Finite Carbon, the largest US forest carbon offset developer. According to bp, Finite Carbon will be integrated into the energy giant’s in-house business accelerator, bp Launchpad.”

    • The Financial Times reports that UK public pension funds suffer £2bn hit to oil investments: https://www.ft.com/content/f74502ad-8ae9-4715-a297-
      “Value of oil company shares held by 56 local government retirement schemes has halved since 2017.”

    • Reuters reports that Rio Tinto names Stausholm as CEO in surprise pick after cave destruction: https://in.reuters.com/article/rio-tinto-ceo-idINKBN28R1KV
      “Rio Tinto named Chief Financial Officer Jakob Stausholm as its next chief executive on Thursday, defying expectations it would pick an external candidate to repair its image after its destruction of sacred Aboriginal rock shelters.”

    • The Financial Times reports that Aberdeen Standard targets women-led hedge funds with new strategy: https://www.ft.com/content/1825813c-0347-4c13-81cb-
      “Funds run by women have outperformed in 2020 after limiting losses in March turmoil.”
    • The Financial Times reports that Shell executives quit amid discord over green push: https://www.ft.com/content/053663f1-0320-4b83-be31-fefbc49b0efc
      “Royal Dutch Shell has been hit by the departure of several clean energy executives amid a split over how far and fast the oil giant should shift towards greener fuels.”
    • Ethos strengthens its climate and diversity voting guidelines: https://www.ethosfund.ch/en/news/ethos-strengthens-its-climate-and-diversity-guidelines
      “Ethos published this Thursday the 20th edition of its voting guidelines and governance principles for the 2021 general meetings. Ethos asks the major emitters of greenhouse gases to publish and submit to shareholders' approval an annual report on their climate strategy and introduces new voting criteria into its guidelines.”

    • ISS Insights reports that Switzerland Votes Against Federal Popular Initiative to Prohibit the Financing of Weapons Producers: https://insights.issgovernance.com/
      “The initiative intended to prohibit the direct and indirect financing of weapons producers by Swiss public financial institutions. According to the Swiss Federal Chancellery, 42.55% of popular votes were in favour, whereas 57.45% voted against the proposed constitutional amendment, which was pursued by the Initiative Against War Trade (Bündnis für ein Verbot von Kriegsgeschäften), a coalition of Swiss political parties and civil society organizations.”
      • Madrid es Noticia reports that Global Finance reconoce el área de Banca Privada de BBVA como la mejor del mundo (“Global Finance recognizes BBVA's Private Banking as the best in the world in terms of sustainability and responsible investment”) (in Spanish): https://www.madridesnoticia.es/2020/12/banca-privada-de-bbva-2/ “The prestigious North American finance magazine Global Finance has recognized BBVA as the best private bank in the world in the field of social responsibility, in a new edition of the 'World's Best Private Bank Awards 2021'. This award recognizes BBVA's strategy and its progress in responsible investment during 2020 and other medium and long-term initiatives that the area will implement.”

      • Público reports that España aborda el reto de la sostenibilidad con altas cotas de credibilidad inversora de sus empresas (“Spain addresses the challenge of sustainability with high levels of investment credibility of its companies”) (in Spanish): https://www.publico.es/economia/espana-aborda-reto-sostenibilidad-altas-
      • Corresponsables reports that El estudio del Estado de la Responsabilidad Corporativa de la Gran Empresa en España muestra sus resultados (“The study of the State of Corporate Responsibility of Large Companies in Spain shows its results”) (in Spanish): https://www.corresponsables.com/actualidad/ods16-estudio-estado-
        “Climate Change, Diversity, Sustainable Mobility and Circular Economy will be the great challenges of Large Companies in Spain in the short term.”

      • Expansión reports that Santander estudia ajustes en el bonus de la cúpula por las pérdidas de 2020 (“Santander studies adjustments in the senior leadership bonus due to 2020 losses”) (in Spanish): https://www.expansion.com/empresas/banca/2020/12/13/5fd6850ce
        “The bank, the only one in the Ibex that maintains the variable, is analyzing how to count red numbers of more than 7,000 million due to the deterioration of goodwill and awaits the decision of the ECB on dividends.”

      • Expansión reports that Cuenta atrás: Unicaja y Liberbank tienen 20 días para aprobar su fusión (“Unicaja and Liberbank have 20 days to approve the merger”) (in Spanish): https://www.expansion.com/empresas/banca/2020/12/13/5fd672e2468
        “Waiting for the approval of the councils / If the entities, stranded in governance, delay in giving the green light to the union, they could have to start almost from scratch.”
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        North America
        United States
        • The Wall Street Journal reports that Nasdaq Seeks Board-Diversity Rule That Most Listed Firms Don’t Meet: https://www.wsj.com/articles/nasdaq-proposes-board-
          “Nasdaq Inc. is pushing to require the thousands of companies listed on its stock exchange to include women, racial minorities and LGBT individuals on their boards, in what would be one of the most forceful moves yet to bring greater diversity to U.S. corporations.”

        • The Harvard Law School Forum on Corporate Governance hosts a piece on Preparing for Shareholder Activism in the Wake of COVID-19: https://corpgov.law.harvard.edu/2020/11/30/preparing-for-shareholder-
          “The shock, turmoil, uncertainty, and lack of visibility that followed the immediate onset of the coronavirus (COVID-19) pandemic in March 2020 were significant factors accounting for why shareholder activism was relatively subdued during the 2020 proxy season. However, given that activist investors have now had more than eight months to acquire their “sea legs” and recalibrate their playbook for the evolving “new normal,” it is likely that, even as the COVID-19 pandemic shows no signs of abating, activist investors will be less reluctant to wage an activism campaign in whatever “new normal” we find ourselves in during the 2021 proxy season.”

        • Rutgers has published its Report of the 2020 Multi-Stakeholder Working Group on Practices for Virtual Shareholder Meetings: https://cclg.rutgers.edu/wp-
          “The scope of this Report comprises the conduct during the VSM and the related disclosures made before and after the meeting. It is designed to outline expectations, as well as evolving practices, for VSMs once a company has decided to hold its annual meeting using a VSM platform. It also highlights certain areas of the VSM experience. In this sense, the Report should be used as a guide for—but not an endorsement of—VSMs.”

        • Bloomberg reports that NYC Steps Up Pressure on Major Companies to Release Diversity Data: https://www.bloomberg.com/news/articles/2020-12-10/walmart-
          “New York City is stepping up pressure on Walmart Inc., McDonald’s Corp., Nike Inc. and almost two dozen other major companies, asking them to release workforce data on race and gender or face a shareholder vote next year.”

        • Blackrock has published its 2021 Stewardship Expectations: https://www.blackrock.com/corporate/literature/publication/our-2021-
          “The events of this year have intensified our conviction that sustainability risk — and climate risk in particular — is investment risk. Therefore, together with updates to our policies on governance factors, we have made several notable changes to our policies on environmental and social factors. These changes reflect our continuing emphasis on board effectiveness alongside the impact of sustainability-related factors on a company’s ability to generate long-term financial returns.”

        • The Wall Street Journal reports on Trump’s Fair Banking Rule: https://www.wsj.com/articles/trumps-fair-banking-rule-11606778173 “Pushing back against the left’s red-lining of unpopular industries.”

        • The Financial Times reports that Former Exxon chief Lee Raymond to retire from board of JPMorgan Chase: https://www.ft.com/content/71dd311c-f77a-4deb-
          “Veteran director will step down at end of year following pressure from environmental activists.”
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        Hong Kong
        • HKEX launches STAGE, a sustainable and green exchange: https://www.hkex.com.hk/news/news-release/2020/201201news?sc_lang=en “HKEX  announce the official launch of the Sustainable and Green Exchange (STAGE), Asia’s first multi-asset sustainable investment product platform, supporting fast-growing global demand for sustainable finance.”

        • FinanceAsia reports that HKEX introduces settlement acceleration platform for Stock Connect programme: https://www.financeasia.com/article/hkex-
           “The platform, HKEX Synapse, is aimed at adhering to mainland market’s T+0 settlement cycle and will begin testing in 2021 with pilot users for deployment targeted in first quarter of 2022.”

        • China Daily reports that Re-listings bode well for A-share investors: http://www.chinadaily.com.cn/a/202012/07/WS5fcd83f0a31024ad0ba9a353.html “A series of high-profile secondary listings of technology companies such as JD and NetEase in Hong Kong this year appear to have created a mistaken belief-that most of the Chinese stock issuers facing a potential delisting threat in the United States will seek refuge in the Hong Kong stock exchange. Indeed, secondary listings in Hong Kong have become the main channel for qualified US-listed Chinese companies returning home for finance so far. But, increasingly, more medium-and small-cap Chinese issuers will instead seek to re-list on the mainland stock markets in the future.”

        • Reuters reports that Hong Kong legislature backs studies for artificial islands despite criticism: https://www.reuters.com/article/hongkong-property-artificial-islands/
          “The plan, estimated to cost at least HK$624 billion ($80.51 billion), or close to a quarter of the city’s gross domestic product, would be Hong Kong’s most expensive infrastructure project, and would cover an area about a third of Manhattan’s. The project has drawn criticism both on cost grounds and for its possible environmental impact.”
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        Daniele Vitale
        Head of Governance UK &Europe > Corporate Advisory
        T +44 (0)20 7019 7034 M +44 (0)7747 697 136 F +44 (0)870 702 0158
        Moor House, 120 London Wall, London EC2Y 5ET, United Kingdom

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