– The Guardian reported that Facebook employees were criticizing Mark Zuckerberg on social media for his refusal to act against US President Donald Trump. Disagreement came from employees at all levels of the company, including some senior staff. Particular criticism was aimed at Zuckerberg’s decision to leave in place the Facebook version of a tweet sent by Trump in which the president appeared to encourage police to shoot rioters. Twitter hid the message behind a warning.
Zuckerberg had said he disagreed with Twitter’s interpretation of Trump’s statement, which included the phrase: ‘When the looting starts, the shooting starts.’ Zuckerberg said: ‘Personally, I have a visceral negative reaction to this kind of divisive and inflammatory rhetoric. I disagree strongly with how the president spoke about this, but I believe people should be able to see this for themselves.’
Some employees appealed to the company’s oversight board, a quasi-independent body that Facebook has funded to act as a ‘supreme court’ capable of ruling on difficult questions around content moderation. The board said it would not be able to intervene in time but was ‘working hard to set the board up to begin operating later this year.’
– The Guardian also reported that the International Monetary Fund (IMF) in late May said equity markets have generally ignored the increasing number of natural disasters over the past 50 years and tougher rules are needed to make investors aware of the dangers posed by climate change. Companies should be required to disclose their exposure to climate risk because a voluntary approach does not go far enough, the IMF said in a chapter from its latest global financial stability report.
The Task Force on Climate-related Financial Disclosures outlines how companies should calculate and disclose to investors their exposure to climate risk.
‘An increasing number of firms have begun to voluntarily disclose climate change risk information, in line with the recommendations set out by the taskforce on climate-related financial disclosures,’ the IMF said. ‘However, going further by developing global mandatory disclosures on material climate change risks would be an important step to sustain financial stability.’
– Coty appointed its fourth new CEO in under four years and finalized its $2.5 billion deal to sell a majority stake in its professional beauty and retail haircare businesses to KKR & Co, The Wall Street Journal reported. Peter Harf, Coty’s current chair, will also assume the CEO role. The move leaves the company’s fortunes directly in the hands of its largest shareholder, JAB Holding Co, of which Harf is one of two managing partners.
– According to CNN, Bank of America is donating $1 billion over the next four years to community programs and small businesses to help address economic and racial inequality that has been worsened by Covid-19. CEO Brian Moynihan said ‘underlying economic and social disparities’ were made worse by the pandemic and mentioned the nationwide protests sparked by the death of George Floyd in police custody, saying this has ‘created a sense of true urgency’, adding: ‘We all need to do more.’
Moynihan is the latest high-profile CEO to publicly speak about the protests. Peloton, Intel and Verizon have also announced donations to minority-oriented organizations.
– The Wall Street Journal reported that more than 20 of the world’s largest co-working companies, which are facing threats to their business from the Covid-19 pandemic, have agreed to co-ordinate in a way that would have been unheard of before the crisis. The companies, which include Industrious and Convene in the US, JustCo of Singapore and IWG of the UK, have created a new umbrella organization known as the Workplace Operator Readiness Council.
WeWork is not a member. A WeWork spokesperson said the company opted against joining because ‘with more than 100 locations in China, WeWork quickly developed, shared and began implementing plans for a safe return to the workplace in early April.’
– Reuters reported that General Motors (GM) and Ford Motor Co condemned racial inequality in the US following the death of Floyd, an unarmed black man. In a letter to employees, GM CEO Mary Barra wrote that she was ‘impatient and disgusted’ following the death of Floyd and emphasized the need to ‘individually and collectively’ drive change. The company shared Barra’s letter with thousands of dealers and suppliers. Barra also said she was commissioning an inclusion advisory board at the company.
Ford’s executive chair, Bill Ford, and CEO Jim Hackett also wrote a joint letter to employees addressing the ‘tragic killing of George Floyd’ and America’s ‘systemic racism.’
– Ryanair Holdings and its CEO Michael O’Leary failed to persuade a US judge to dismiss a securities fraud lawsuit accusing the European budget airline of defrauding shareholders by downplaying its willingness to recognize labor unions, according to Reuters. Although dismissing much of the proposed class action, US district judge Paul Oetken said shareholders could try to prove that Ryanair intended to mislead them with statements indicating a ‘near certainty’ it would not welcome unions, the recognition of which could increase costs and reduce profitability.
Oetken dismissed claims concerning other statements about Ryanair’s labor relations, profitability and growth targets, finding no proof the statements were false.
Ryanair and its law firm did not immediately respond to requests for comment. Lawyers for the lead plaintiff did not immediately respond to similar requests.
– According to CNBC, the manager of S&P’s scoring system for its ESG index said it takes into account companies’ responses to their communities in times of stress. Mona Naqvi, head of ESG product strategy at S&P Dow Jones Indices, was speaking after nationwide protests were held following the death of Floyd while in police custody.
‘We do take into account things like how companies are behaving with respect to their raw stakeholders,’ Naqvi said. ‘So not just their employees and their shareholders, but how they interact with their broader community, which is really important in terms of building goodwill in times of stress like this.
‘It’s also important through ESG to take into account things like diversity. How does a company actually hire? What are its hiring practices? Is it diverse throughout its broader business operations? And I think these are all types of issues that these protests are demonstrating are very important to many people, which ESG can help capture.’
– CNN reported that ice cream maker Ben & Jerry’s called on Americans to ‘dismantle white supremacy’ and ‘grapple with the sins of our past’ as nationwide protests against racial injustice continued. In a statement posted to the company’s website late on Tuesday, Ben & Jerry’s describes the death of Floyd as the result of ‘inhumane police brutality that is perpetuated by a culture of white supremacy.’
‘What happened to George Floyd was not the result of a bad apple; it was the predictable consequence of a racist and prejudiced system and culture that has treated black bodies as the enemy from the beginning,’ said the brand, which is owned by Unilever.
The company also called for the US Department of Justice to reinvigorate its Civil Rights Division, and for Congress to pass HR 40, a bill that would create a commission to study the effects of discrimination since African slaves first arrived in North America in 1619 and recommend remedies.
– CNBC reported that an analyst at BNP Paribas Asset Management said investors have been ‘doubling down’ on sustainability over the last quarter – and sustainable funds have performed better than the broader market. That’s a shift from historical precedents where people shifted their focus from sustainability to near-term profits in tough times, according to Gabriel Wilson-Otto, head of stewardship for Asia-Pacific at the French bank.
‘In Asia ex-Japan, even with the deterioration in markets, ESG assets are actually up 21 percent in the first quarter, and this has also been supported by really strong performance from sustainable funds,’ Wilson-Otto added.
– Reuters reported that Amazon.com has been sued for allegedly fostering the spread of Covid-19 through unsafe working conditions, causing at least one employee to contract the disease, bring it home and see her cousin die. The complaint was filed in the federal court in Brooklyn, New York, by three employees of the company’s fulfillment center in Staten Island, and by family members.
One employee, Barbara Chandler, said she tested positive for Covid-19 in March and later saw several household members become sick, including a cousin who died on April 7. The lawsuit said Amazon has made the fulfillment center a ‘place of danger’ by impeding efforts to stop the coronavirus spreading, increasing productivity at the expense of safety.
Amazon did not comment on the lawsuit but said it has always followed guidance from health authorities and its workplace safety experts since the pandemic began. The company is spending more than $800 million on coronavirus safety in this year’s first half, including cleaning, temperature checks and face masks.
– The SEC announced a nearly $50 million whistleblower award, the largest amount ever given to one individual under the agency’s whistleblower program. The next largest is a $39 million award to an individual in 2018. ‘This… brings the total awarded to whistleblowers by the SEC to $500 million, including $100 million in this fiscal year alone,’ said Jane Norberg, chief of the SEC’s office of the whistleblower, in a statement. ‘Whistleblowers have proven to be a critical tool in the enforcement arsenal to combat fraud and protect investors.’
– Reuters reported that Volkswagen said it has completed an internal report into how it came to publish a racist advert, adding that its findings will be released once its management board has reviewed the matter. The management board, headed by CEO Herbert Diess, meets regularly on Tuesdays. Criticism of the advert went viral last month and the company apologized and pulled the clip, prompting Volkswagen’s labor leaders to accuse management of damaging the company. Volkswagen admitted that the advert was racist and insulting.
– According to the Financial Times, the US president set a 60-day deadline for financial regulators to recommend ways to clamp down on Chinese companies listed in the US that fail to meet proper accounting standards. Trump said in a memorandum that he was instructing the presidential working group on financial markets – which includes US Treasury secretary Steven Mnuchin, Federal Reserve chair Jay Powell, SEC chair Jay Clayton and Commodity Futures Trading Commission chair Heath Tarbert – to suggest actions the executive branch could take to curb certain Chinese listings.
US officials have been particularly concerned that the Chinese government is preventing auditing firms from giving the PCAOB paperwork it requires for auditing inspections of companies listed in the US.