TheCorporateCounsel.net

May 25, 2018

An Anti-ESG Campaign Begins

Here’s something that I blogged yesterday on our “Proxy Season Blog”: The National Association of Manufacturers (NAM) and other conservative-leaning organizations have launched a new campaign, the “Main Street Investors Coalition” – with a multi-million dollar budget – to limit the influence of large asset managers that they feel wield too much power on ESG initiatives. As we’ve previously blogged, more support from Vanguard is one factor that has led to higher approval rates for ESG proposals – and, as noted in this blog, BlackRock has also urged companies to develop a long-term strategy that accounts for their societal impact.

This Axios article says that the group’s first focus will be writing studies & op-eds backing up their positions – which is interesting in light of recent DOL guidance that restricts ERISA fiduciaries from pursuing ESG initiatives in the absence of data showing that the initiatives will lead to higher returns. It’s not clear yet whether this group will also pursue the tactic of submitting its own shareholder proposals, in order to beat ESG activists to the punch.

The Axios article notes that this campaign comes at a time when “shareholder advocacy” has been producing more social change among companies than legislation. And here’s an excerpt from an op-ed by Bloomberg’s Matt Levine:

The interesting development will be if this (pro-corporate, anti-environmentalist, etc.) group makes common cause with the more left-ish critics of institutional investors who worry that they create antitrust problems. Having most of corporate America controlled by a handful of giant institutions: It makes a lot of people nervous.

Deloitte Fined $500k for Faulty Audit

Yesterday, as noted in this article, the PCAOB levied a hefty $500k upon Deloitte for missing material accounting errors in three consecutive audits of a client…

Memorial Day Weekend

May we have lasting gratitude and memories of those who’ve sacrificed for our country.

Liz Dunshee