December 17, 2015 - Issue 13 - Your weekly news on all things board.
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Director's Domain: News & views for today's boardroom. Brought to you by Boardspan.

Boards are flexing their muscles this week as they push back on activist investors whose “good ideas” don’t look all that great to insiders. Directors at Dow Chemical made a public show of their unanimous support for CEO Andrew Liveris and an announced Dow-DuPont merger, thwarting efforts by Daniel Loeb’s Third Point LLC to derail the deal and dethrone the executive. The Qualcomm board followed suit, announcing that—after appointing a special committee to review the company’s structure—it opposed the proposal of an activist hedge fund investor to split the company into two business units. One imagines that these CEO-supporting victories are music to the ears of Irene Rosenfeld, chief executive of Mondelez International, who estimates she spends 25% of her time addressing activists.

May your holidays and boards be merry and bright! Enjoy this final issue of Director's Domain in 2015 and look for us in your inbox in January.

The Hot Seat


Dow Chemical Board Hits Back at Activist

“Long-simmering hostility between Dow Chemical Co. and Daniel Loeb reached a boiling point over the weekend, with the shareholder activist calling for the removal of Chief Executive Andrew Liveris in the wake of the company’s agreement to merge with DuPont Co. … Dow hit back hard. Directors, including one appointed to the board at the behest of Mr. Loeb’s Third Point LLC, defended the deal and Mr. Liveris in a series of interviews …. In a statement, the company said the board was unanimous, including Third Point’s directors, in supporting the deal, calling it ‘a win for all of our shareholders.’” MARKETWATCH

Across the Board

Curated news and insights from the world's boardrooms.


Qualcomm Board Refutes Investor Demands

“Qualcomm Inc has announced that it has completed a comprehensive review of the company and plans to stick with its current corporate and financial structure. The company, which has suffered a difficult year, had come under pressure from activist hedge fund investor JANA Partners LLC – a significant Qualcomm shareholder – to conduct a review of the structure of the company on the grounds that an alternative structure could realize value for shareholders. The strategic review was conducted by a special committee of the board of directors and gave a unanimous recommendation to stick with the current structure. EE TIMES

The Real Costs of Engaging with Activists

“After Halloween, Nelson Pelz, one of two big activist investors holding Mondelez stock called [the snack giant’s CEO Irene Rosenfeld] to tell her that his 12-year-old twins had rummaged through their treats and tossed their bags aside. Children were eating less candy, he said, and Mondelez had to adjust. Another activist, William Ackman, has been pestering Ms. Rosenfeld, a veteran marketer, to slash the number of products and change her advertising plans. ‘I’m frustrated with investor’s fascination with activists,” she said in a recent interview. “I’m successfully running Mondelez for all shareholders—without the activists’ help.’… She says addressing their concerns consumes one-quarter of her time.” WALL STREET JOURNAL (subscription)

Yahoo Board Gets an Earful

“More shareholders are vocalizing their opposition to Yahoo’s latest reinvention strategy, signaling a battle ahead for seats on the struggling tech company’s board if they don’t get their way…. Investment management firms Canyon Capital Advisors LLC and Starboard Value, which both own substantial stakes in Yahoo, said they want the company to look into selling the core business. Meanwhile, Yahoo investor SpringOwl Asset Management LLC believes Yahoo can still turn around its business if it replaces its CEO and board members, lays off 9,000 workers and slashes perks like free food, which cost the company $450 million over the past four years.”  SFGATE

Can VW Remake its Corporate Culture?

“All cars at the headquarters should, according to the rules, be parked facing the same way. The firm is controlled by a tight-knit troika of a billionaire family (Ferdinand Porsche’s descendants), a German state government (Lower Saxony) and powerful labor unions. The corporate jet is not just any jet, but a full-size Airbus. Volkswagen, by any standards, has an unusual corporate culture. As the automotive giant struggles to explain a globe-spanning emissions-cheating scandal, its management culture — confident, cutthroat and insular — is coming under scrutiny as potentially enabling the lawbreaking behavior…. ‘They only know one way of management,’ said a high-ranking executive who has worked in several countries for the carmaker and who requested anonymity for fear of losing his job: ‘Be aggressive at all times.’” NEW YORK TIMES (subscription)

How Many Board Seats is Too Many?

“As of last month, [former AOL Inc. chief Jonathan F. Miller] was on the boards of eight publicly traded companies in six cities that collectively hold more than 100 meetings a year. Those positions are expected to pay him well over $1 million this year. Miller also sat on 11 other boards of privately held and nonprofit enterprises, while holding down a day job as a partner in a Norwood venture capital company…. Situations like Miller’s are fueling a simmering debate across corporate America: How many public boards are too many for one person to handle?” BOSTON GLOBE

A Seat at the Table

Oracle elects former Intel president Renee James to its board of directors. Equinix, a global interconnection and data center company, appoints to its board Nanci Caldwell, former EVP and CMO of PeopleSoft and current director on the boards of CIBC and Citrix Systems. Eva Chen, head of fashion partnerships at Instagram, joins the board of Yooz Net-a-Porter Group, the online designer fashion retailer. The General Mills board elects two new directors: Roger W. Ferguson Jr., CEO of TIAA-CREF, and Eric D. Sprunk, COO of Nike. ★  Wendy’s Co. boosts its board size with two new directors: Dennis Kass, a former executive at J.P. Morgan and Goldman Sachs, and Matthew Peltz, the son of billionaire investor and Chairman Nelson Peltz, whose activist investment firm Trian Partners holds a 14.9% stake in the fast food chain. CSC, a global provider of business technology solutions, appoints its CEO Mike Lawrie as board chair and welcomes new directors: Mukesh Aghi, president of the U.S.-India Business Council and former president of IBM India, and Herman E. Bulls, vice chairman and former CEO of Americas of JLL.The Kroger Co. board welcomes Anne Gates, president of MGA Entertainment, Inc., a privately-held developer, manufacturer and marketer of toy and entertainment products for children.
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