Ch-Ch-Changes Ahead: A Common Theme from This Year’s Berkeley Forum on Corporate Governance | | |
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San Francisco greeted attendees of the Berkeley Fall Forum with brisk air and the turning of leaves – signs of change that echoed through the two-day confab. Across geopolitical threats, regulatory uncertainty, and the promises of AI, conference panelists made clear: the speed of change has been jarring.
Change rang true from the stark difference in how corporate leaders are responding to the second Trump administration compared to the first – with almost nonexistent pushback to policies – which the Financial Times’ Stephen Morris attributed as a mix of pragmatism, opportunism, and a healthy dose of fear. We heard a similar sentiment during a panel that featured our own Lauren Odell, where TPG Capital’s deputy general counsel Matthew Cowcher noted that CFIUS risk analysis is being done much earlier in deal processes than ever before. One change that corporates are not seeing happening under the new regime: Deregulation. Instead, panelists are seeing meaningful re-regulation around different priorities (tariffs, hydrocarbon production), which companies need to understand and reposition their engagement strategies for.
As for the ever-existential question of whether to stay incorporated in Delaware, practitioners agreed that Delaware remains dominant despite the 25 corporations that redomiciled in Nevada last year. Regarding the Silver State, shareholder lawyer Jeroen van Kwawegen quasi-joked that only controlling shareholders with less-than-good intentions reincorporate in Nevada, taking a dig at Sphere Entertainment’s Jim Dolan: “goodbye, good luck, Delaware doesn’t need you.”
Conference attendees got the added treat to be a part of a live taping of David Marcus’ podcast, Drinks with the Deal, featuring University of Iowa Professor and author of Catching Cheats, Erik Lie. Noting that “conflict leads to fraud,” Lie spoke about his fascination with fraud and the systemic conflicts that allow for it to happen. He also questioned whether eliminating quarterly earnings and moving to a twice-per-year arrangement actually creates the right incentives for management teams in how to approach earnings management and reporting.
The conference concluded with a timely panel on Shareholder Democracy and Ownership, where speakers debated the plethora of changes affecting proxy voting – changes at the big three, Exxon, voting choice, and changes at ISS and Glass Lewis to name a few. Under the picture of a more fragmented proxy voting dynamic, panelists disagreed on who benefits more – shareholders or companies. Vanguard’s global head of investment stewardship, John Galloway, shared his view that clients for years had been asking for more agency in proxy voting – hence his firm’s push on pass-through-voting, and his belief that markets will evolve and clarity will come through even in a more disaggregated world.
Have a great weekend,
GPP Team
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Reuters: Novartis to Acquire Avidity Biosciences for About $12 Billion
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Bloomberg Opinion: Money Stuff: Pay Now, Merge Later
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The synergies of the scientific instrumentation company and the endpoint data solutions provider are expected to generate a double-digit internal rate of return, as the two companies are said to be complementary in their research and data capabilities. The transaction is expected to close mid-next year, with opportunities for future earn-out payments based on the business’ performance in the next two years. Read More
The Wall Street Journal: Huntington Reaches $7.4 Billion Deal to Buy Cadence Bank
Continuing a string of consolidation in the banking industry, Huntington Bancshares announced that it is acquiring Cadence Bank for $7.4 billion. The deal, which will give the combined bank $276 billion in assets, expands Huntington’s reach into the South, particularly Texas, and comes after smaller acquisitions for both banks with Huntington buying Veritex Holdings and Cadence having bought Industry Bancshares. Read More
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The Wall Street Journal: OpenAI’s Promise to Stay in California Helped Clear the Path for Its IPO
As part of OpenAI’s recent move to convert to a more traditional corporate structure, previously a hurdle to going public, the company pledged to remain in California as a part of a deal with California Attorney General Rob Bonta. In addition, Reuters reported earlier this week that the company is considering filing for one of the biggest IPOs of all time. The move, which could happen as early as the second half of 2026 for a 2027 IPO, could value the ChatGPT-maker at up to $1 trillion. Read More
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With Tesla’s highly watched shareholder vote on Elon Musk’s pay package coming up on November 6, the company and its Board Chair have been running a get out the vote campaign to help get things over the finish line. As a part of the company’s media engagement, the Chair did note that the company has begun to look at internal replacement candidates if Musk does decide to leave. Read More
Financial Times: Does the End of ‘Benchmark’ Proxy Policies Actually Change Anything?
In an opinion piece for the FT, professors Jonathon Zytnick, Nadya Malenko and Edwin Hu discussed the recent announcement from Glass Lewis that it will stop making standardized recommendations to its customers. The article asks the question of if this announcement actually changes anything moving forward, noting that it likely won’t since “80 per cent of Glass Lewis customers already receive customised advice based on their preferences.” Read More
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Bloomberg: Medical Supplies Manufacturer Medline Files for IPO
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Imagine taking a cool Lower East Side Southeast Asian restaurant replete with servers and bartenders with nose rings and tattoos and plop it in the heart of the Upper West Side, where you can easily get hurt by giant strollers wheeled by very aggressive young parents.
Well, that's Pig And Khao, which had been on the LES for many years before growing up and getting an apartment on Amsterdam Avenue. Chef Leah Cohen has Filipino on one side of her family and Romanian-Jewish on the other, and she worked at some of New York's finest restaurants.
The vibe is playful and upbeat, the music fun (but not too loud), and most importantly the menu was fantastic. For starters, we had the papaya salad, the BBQ pork tacos, and then Murtabak, which is a roti made like a quesadilla. Then for our main, we shared the fried whole fish (porgy aka sea bream) with sweet and sour Thai basil sauce. We had to have rice, so we went with crab fried rice with an egg, and for a veggie Kalabasa Sa Gata, a mix of squash, tofu and beans in a coconut milk sauce. For drinks, the cocktail menu was fun, and the wine list efficient but with nice choices. We sat at the bar; they also have a chef's counter and outside space. Three stars from GPP!
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John Malone will relinquish his board roles at both Liberty Media and Liberty Global and transition to chair emeritus. Read More
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Etsy CEO Josh Silverman will step down as CEO, to be succeeded by the company’s President and Chief Growth Officer, Kruti Patel Goyal. Read More
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CSX named Kevin Boone as CFO; Boone succeeds Sean Pelkey after three years in the role. Read More
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