December 13, 2019
Weekly Activism Highlights: Al Gore, Integrity Marketing, Hudson's Bay
Following closed-door U.N. climate talks in Madrid, the politician-turned-environmental activist Al Gore sat down with the Financial Times’ Leslie Hook. While the major index funds joined a coalition of 600 asset managers with $37 trillion AUM, in calling for action on climate change, the former vice president lambasted fund managers like BlackRock and Vanguard, who he said continue to “finance the destruction of human civilization.” Gore noted that these funds have not divested from fossil fuel stocks and he also pointed to “incredible economic risks from a massive bubble of carbon assets” – around $22 trillion – and continues to push for their divestment.

Meanwhile, the Wall Street Journal did a deep-dive on the implications of the Business Roundtable’s August decision to begin to “deliver value to all” stakeholders, rather than endorsing shareholder primacy. This decision was met with celebration and skepticism, but one CEO is putting his money where his mouth is: Integrity Marketing Group, a distributor of life and health insurance products, is splitting $50 million between its 750 employees and making all employees eligible to receive company stock. 

In company news, Hudson’s Bay shareholders and stakeholders are in limbo. Shareholders in the retailer, whose brands include Saks Fifth Avenue and Lord & Taylor, face two competing bids: one from Chairman Richard Baker, who bid 10.30 Canadian dollars for the company in a consortium with Rhone Capital and WeWork Industrial Trust; and Catalyst Capital Group, who bid 11 Canadian dollars per share. Shareholders have received conflicting recommendations, with ISS recommending against Baker’s deal and Glass Lewis recommending shareholder vote in favor. But, any deal would require the Chairman’s blessing, leaving the embattled company in a bind. 

Have a great weekend,

Thematic Articles
The Wall Street Journal: The Tricky Role of the CEO in a New Era of Social Responsibility

The Business Roundtable recently said companies should meet the interests of ALL stakeholders, rather than just shareholders. CEOs should brace themselves for the consequences Read More
Financial Times: Battle royale: SEC locks horns with investors over proxy advisers

Corporate governance advisers at heart of fight that has also pitted investors against companies Read More
Financial Times – Opinion: Enlightened ESG investors engage, but retain right to divest

Pragmatic ‘carrot and stick’ approach can bring about longer lasting change Read More
Financial Times – Opinion: Investors can change the narrative on climate transition

But results will only follow if governments take the lead Read More
Financial Times – Moral Money: Al Gore unloads on index funds

“Do they want to continue to finance the destruction of human civilisation, or not?” Read More
Bloomberg – Opinion: BlackRock Is Too Big to Misbehave

Companies like BlackRock and Vanguard collectively control much of the voting power at almost every public company; they get to tell companies what to do, and they exercise this power to push their particular priorities Read More
Bloomberg: Who Put the ‘S’ in ‘ESG’ (and What Does It Mean)?

There’s been a lot of attention given lately to ESG investing, but not always a lot of explanation Read More
Bloomberg: Activist-Driven Breakups Can Create Risks: Goldman’s Mehrotra 

A wave of corporate breakups and spinoffs being driven by activist and traditional investors is creating hidden, long-term risks for companies Read More
Axios: Saks Fifth Avenue owner in limbo after ISS recommendation

Institutional Shareholder Services recommended that Hudson's Bay Co. shareholders vote against a C$1.9 billion, or C$10.30 per share, takeover offer led by company chairman Richard Baker Read More
Company- or Fund-specific Articles
The Wall Street Journal: Starboard Value Has Nominated Majority Board Slate at Health-Services Company Mednax

Activist investor pushes Mednax to consider partial, full sale Read More
The Wall Street Journal: McAfee Considering a Combination With NortonLifeLock

Consumer-software company has also been approached by private-equity firms Read More
Financial Times: Rolls-Royce’s biggest shareholder ValueAct quits board

Representative of activist investor steps down as non-executive director Read More
Financial Times: BlackRock strives for moral high ground with Wiseman firing

Larry Fink champions company’s culture even if it means losing a potential successor Read More
Bloomberg: Hudson’s Bay Chair Baker Wins Glass Lewis Support for Takeover

Advisory firm says there’s no viable alternative to deal; stance puts shareholder advisory firm at odds with ISS Read More
Bloomberg: Bill Ackman’s Pershing Square Reports Stake in Agilent Technologies

Pershing Square Capital Management announced a stake in life sciences equipment maker Agilent Technologies, having applied for special treatment that allowed the activist to increase its stake Read More
Bloomberg: Francisco and Elliott Are in Talks to Buy LogMeIn

Private equity firm Francisco Partners Management has partnered with hedge fund Elliott Management Corp. in a bid to take workplace software provider LogMeIn Inc. private Read More
Reuters: Alexion Pharmaceuticals rejects Elliott push for "proactive sale"

Alexion Pharmaceuticals said its board of directors had unanimously decided against hedge fund Elliott Management’s push for a “proactive sale” process, saying it would not be in the best interest of shareholders Read More
Axios: Integrity Marketing Group pays employees $50 million

Private equity-backed distributor of life and health insurance products told its 750 employees they’ll receive an aggregate payout of $50 million as a “recognition of their success” Read More
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