Investor Relations Week: Private Equity pays off, No.1 engine invests in GM, and UK companies make progress on diversity on board


– Private equity firms pay bonuses for state-owned enterprises that had not been seen for two decades, according to the Financial Time (paying). The newspaper reports that the average premium paid for European companies is 45% in 2021, the highest level since data company Refinitiv started keeping records in 1980. The average premium for US companies this year is 42%, the highest in 22 years. Some offers went much further and offered “nearly 70% above the previous share price,” the article notes.

CNBC reported that activist investor Engine No 1, which rose to prominence after running a successful campaign for seats on ExxonMobil’s board, announced an investment in General Motors on Monday, signaling its support for the automaker in its transition to electric vehicles. GM, unlike ExxonMobil, is taking concrete action in what the company sees as imperative for long-term success: linking ESG criteria to economic performance.

– Large UK companies are making strides in gender diversity but still lacking women in top positions, reported The Guardian. The proportion of women on the boards of directors of FTSE 100 companies stands at 38%, the highest level on record, according to a study by the Cranfield School of Management. However, only eight companies in the FTSE 100 have a female CEO. Across the FTSE 350, companies exceeded the target set by the Hampton-Alexander study of having at least 33% female representation on boards.

Reuters reported that Glass Lewis recommended that NextGen Healthcare shareholders elect the roster of executive directors, joining ISS to support the board and management in relation to company founder Sheldon Razin. Razin, who has served on the board since 1974, appointed four directors and criticized the company’s financial performance. “Given the circumstances, we believe shareholders are likely to be better served by supporting the current board roster, a roster that already reflects an important refresh that includes the company’s recently hired CEO and three other new nominees,” the Glass Lewis report said.

– Activist investor Carl Icahn announced a stake in Southwest Gas and called on the U.S. utility to “drop rumors of acquiring natural gas company Questar Pipeline,” reported CNBC. Southwest’s share price rose 7% on the news. In a letter to the Southwest board of directors made public, Ichan wrote that “the purchase of Questar that you are currently making at the price that you are willing to pay will make any past mistakes pale in comparison.” Southwest did not immediately respond to a request for comment, CNBC said.

– Mars CEO Grant Reid has warned that “too often” companies’ commitments to reduce greenhouse gas emissions fall short and threaten to undermine their credibility and needed change in climate action, according to The Guardian. Reid’s comments, and those of Mars Chief Sustainability and Purchasing Officer Barry Parkin, come after climate activist Greta Thunberg condemned many of the climate actions promised by world leaders as being so “blah, blah, blah “.

– Standard Chartered is expected to face a vote next year on whether the bank is adjusting enough to meet its net zero commitments, reported Bloomberg. Nonprofits Market Forces and Friends Provident Foundation co-filed a resolution with the bank, calling on it to “match its net zero rhetoric to action.” The case asks the bank to manage fossil fuel exposure in accordance with a scenario of global net zero emissions by mid-century, to set short, medium and long term targets for fossil fuel exposure and stop funding for new fossil fuel projects, Bloomberg said.

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