Nouvelles diverses | Page 20

Belle tribune de Yvan Allaire et Mihaela Firsirotu dans Financial Post : « What post-pandemic corporate governance might look like » (1er mai 2020).

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Another challenge for boards of directors will come from the mood of the population as we emerge from the pandemic. Some flaws and irritants in our current economic system may well become intolerable. For instance, the expectation of continuous growth in earnings per share, the cost-driven global search for the cheapest labour and the disparity in income within both corporations and society may all come in for criticism and calls for reform.

Boards of directors need to be alert to early warnings of impending political and social disturbances, which may be harbingers of the next flock of black swans. If they do not effectively handle these new expectations, they can expect governments now flush with power to seize the initiative regarding work arrangements, executive compensation, wealth-sharing, offshoring, and so forth.

Contrary to what might be expected given the serious financial issues many businesses will face, the recent infatuation of large institutional shareholders with ESG (Environment, Social, Governance) drivers and their corollary, the stakeholder model of the corporation, is unlikely to abate. Too much wind already in those sails and new gusts from the pandemic will lead to calls for even swifter compliance by publicly traded corporations.

Management and boards should act pre-emptively in five areas. The corporation’s access to critical supplies should be closely monitored. All past decisions to outsource and off-shore operations in low-cost countries need to be reviewed and re-assessed.

Work arrangements should be adapted to post-pandemic circumstances, as well as to people’s legitimate quest for work balance and couples’ desire for burden sharing. Though doing so will be hard, boards also need to cut the Gordian knot of executive compensation and set an acceptable ratio of top management compensation to the salary of the median employee.

As most large institutional funds have become advocates of ESG, management and the board should make clear to shareholders what this and the above adjustments will mean for the management, governance and performance of the company.

In the end, the powerful forces of continuity, habit and normalcy may bring us back to the status quo ante. We may wake up from this nightmare unscathed. Perhaps! But a board of directors should not take such a “happy ending” for granted.

À la prochaine…

Le cabinet d’avocat Stikeman Elliott revient dans un billet court sur la mission du CA en contexte de pandémie : « COVID and Corporate Governance: A Broader Mission for Corporate Boards » (24 avril 2020).

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The discussion focuses on the key challenges facing Canada’s corporate leaders as the reopening phase approaches:

• Focusing on issues that matter;
• Immediate crisis management and board readiness;
• Re-thinking strategy and risk management;
• Re-thinking incentive frameworks; and
• Re-thinking corporate purpose.

À la prochaine…

The Conversation publie un article sur la COVID-19 sur la réponse des multinationales à la crise : Sabine Urban et Ulrike Mayrhofer, « La grande disparité des réponses des multinationales du CAC 40 à la crise« , 4 mai 2020.

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L’analyse des données collectées met en relief la diversité des réponses qui sont apportées par les multinationales du CAC 40. Nous avons identifié quatre groupes de multinationales :

• Les multinationales « citoyennes » faisant preuve de générosité (15 entreprises) ;
• Les multinationales tournées vers la continuité de l’activité (10 entreprises) ;
• Les multinationales orientées vers l’innovation (5 entreprises)
• Les multinationales n’ayant pas annoncé de mesures spécifiques face au Covid-19 (10 entreprises).

Plusieurs enseignements peuvent être tirés des réactions observées. Notre travail révèle que la plupart des multinationales s’adaptent à la nouvelle situation et font preuve de flexibilité et de responsabilité.

De manière surprenante, certaines multinationales n’ont pas annoncé de mesures spécifiques par rapport à la pandémie et il serait pertinent de s’interroger sur les raisons de ce choix.

Il ressort de notre analyse que la crise sanitaire mondiale provoquée par le Covid-19 entraîne de nombreux changements pour les multinationales du CAC 40, notamment au niveau des stratégies empruntées, des modes d’organisation et des relations avec les parties prenantes et la société.

À la prochaine…

UCLA School of Law vient de publier un rapport d’une dizainede pages sur la gestion du capital humain et son intégration dans la gouvernance des entreprises : « Corporate Governance : The growing Importance of Human Capital Management » (avril 2020).

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1. Over the last several years, investors and proxy advisory firms have increasingly focused their attention on environmental, sustainability and governance (ESG) and human capital management (HCM) issues. While there is no one definition of HCM, the term is widely used to cover a very broad range of workforce matters that are of concern to investors and the public as they focus on building long-term value and reducing business and reputational risks. These concerns have resulted in calls for enhanced company disclosures about their HCM practices and processes.

2. Under Delaware and federal law, directors have no duties that are specifically focused on HCM. However, under Delaware law and that of many other states, directors have duties of care, loyalty and oversight that can under certain circumstances apply to HCM matters and can result in director liability.

3. While federal securities laws and rules contain several corporate disclosure requirements that apply to employees and touch on HCM issues, current laws and rules are not as robust or focused as many investors would like and have proposed. In response to rulemaking and other investor requests, the U.S. Securities and Exchange Commission has proposed amendments to its disclosure rules that would expressly require companies to describe their human capital resources to the extent that they are material to an understanding of a company’s business as a whole.

4. Some public companies have already articulated board responsibilities for oversight of HCM matters; some have renamed and expanded the responsibilities of their compensation committees to reflect their expanded focus; and some have disclosed their HCM polices and efforts in their securities law filings and other publications.

5. Separate and apart from the legal requirements that apply to corporate board duties and corporate disclosure requirements, there are important business, governance and reputational reasons for boards and companies to care about and address HCM matters. 6. While there is no one-size-fits-all approach to board oversight of HCM matters, areas for possible board attention are (i) diversity and inclusion, (ii) employee satisfaction and engagement, (iii) succession and talent management, (iv) attrition and retention, and (v) ethics, workforce culture and risk.

À la prochaine…

Bonjour à toutes et à tous, je signale cette intéressante étude : Zetzsche, Dirk Andreas and Anker-Sørensen, Linn and Consiglio, Roberta and Yeboah-Smith, Miko, « The COVID-19-Crisis and Company Law – Towards Virtual Shareholder Meetings », 15 avril 2020, University of Luxembourg Faculty of Law, Economics & Finance, WPS 2020-007.

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Regulators and Parliaments around the world have responded to the COVID-19 epidemic by amending company law. This crisis legislation allows us to examine how, and to what effect, the corporate governance framework can be amended in times of crisis. In fact, almost all leading industrialized nations have already enacted crisis legislation in the field of company law. 

In our recent working paper, ‘The COVID-19-Crisis and Company Law – Towards Virtual Shareholder Meetings’,  we have sought to (1) document the respective crisis legislation; (2) assist countries looking for solutions to respond rapidly and efficiently to the crisis; (3) exchange experiences of crisis measures; and (4) spur academic discussion on the extent to which the crisis legislation can function as a blueprint for general corporate governance reform.

Countries considered in full or in part include Australia, Austria, Belgium, Canada, China, France, Germany, Hong Kong, Italy, Luxembourg, the Netherlands, Norway, Portugal, Singapore, South Korea, Spain, Switzerland, Thailand, the United Kingdom, and the United States. Readers are encouraged to highlight any inaccuracies in our presentation of the respective laws, and to bring further crisis-related legislation not considered in this working draft to the attention of the authors. Moreover, readers are invited to indicate where there is room for improvement therein, and/or to signal the need for policy reform.

Drawing on the analysis of these more than twenty countries, we note five fields in which legislators have been particularly active. First, the extension of filing periods for annual and quarterly reports to reflect the practical difficulties regarding the collection of numbers and the auditing of financial statements. Second, company law requires shareholders to take decisions in meetings—and these meetings were for the most part in-person gatherings. However, since the gathering of individuals in one location is now at odds with the measures being implemented to contain the virus, legislators have generally allowed for virtual-only meetings, online-only proxy voting and voting-by-mail, and granted relief to various formalities aimed at protecting shareholders (including fixed meeting and notice periods). Third, provisions requiring physical attendance of board members, including provisions on signing corporate documents, have been temporarily lifted for board matters. Fourth, parliaments have enacted changes to allow for more flexible and speedy capital measures, including the disbursement of dividends and the recapitalization of firms, having accepted that the crisis impairs a company’s equity. Fifth and finally, some countries have implemented temporary changes to insolvency law to delay companies’ petitioning for insolvency as a result of the liquidity shock prompted by the imposition of overnight lockdowns.

The legislation passed in response to the COVID-19 crisis provides for an interesting case study through which to examine what can be done to modernize the corporate governance framework with a view to furthering digitalization. Given the difficulties or indeed the impossibility of conducting in-person meetings currently, the overall trajectory of company law reforms has been to allow for digitalization of corporate governance, and ensuring the permissibility of virtual shareholder meetings (VSM), in particular. 

In this respect, it is safe to assume that the rules on VSM will have model character. While the details of the modus operandi of VSM will require careful adjustment, to ensure that shareholders will be afforded the same rights and opportunities to participate as they would at an in-person meeting (including Q&A), the experimental phase during the crisis will feed into the policy discussion, with some more successful and some less successful examples providing food for thought. Yet, it is safe to say that the COVID-19 pandemic has unveiled the need for virtual-only shareholder meetings, and that some types of VSM will stay for good long after the current crisis has subsided. 

À la prochaine…

Dans La presse, Stéphanie Grammond livre une belle réflexion dans sa chronique intitulée « Les retraités avant les actionnaires » (26 avril 2020). Très intéressant et qui rappelle le chapitre du livre que j’ai rédigé avec mon collègue Charles Tremblay-Potvin à paraître « Sears Canada : les retraités sacrifiés à l’aune de la primauté actionnariale ? » dans Droit des aînés (éditions Yvon Blais).

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À la mi-avril, Ottawa a annoncé un assouplissement temporaire pour donner du lest aux employeurs qui parrainent un régime de retraite à prestations déterminées. Or, ces mesures affaibliront la protection des rentes à un moment où les régimes traversent une tempête parfaite.

(…)

Vu à l’envers, il y a maintenant un « trou » de 11 % dans les caisses de retraite, un déficit qui doit être comblé par des cotisations spéciales des employeurs.

Mais comme les sociétés grattent les fonds de tiroir, Ottawa a décrété un moratoire sur ces cotisations pour 2020 et laisse entrevoir un allégement pour 2021 pour les entreprises de compétence fédérale (ex. : transports, banques, télécoms).

Au Québec, les sociétés ont déjà eu de l’oxygène ces dernières années. Leurs cotisations ne sont plus établies en fonction du ratio de solvabilité qui donne le portrait en cas de faillite. Elles le sont plutôt en fonction d’un ratio de « capitalisation améliorée » qui permet l’utilisation d’hypothèques plus accommodantes fondées sur la « continuité des affaires », un concept qui semble bien fragile en cette ère de pandémie.

(…)

Les gouvernements font le pari que ces assouplissements aideront les entreprises à survivre et à payer des rentes pleines et entières. Mais en cas de faillite, les retraités seront doublement perdants, car ils se retrouveront avec une rente amputée plus sévèrement.

D’où l’urgence de trouver des solutions pour mieux les protéger.

Malheureusement, il est trop tard pour lancer un fonds de garantie des prestations de retraite comme en Ontario. Quand un 18 roues est sur le point d’emboutir votre voiture, ce n’est plus le temps d’appeler l’assureur.

Par contre, on devrait changer les lois encadrant les faillites pour donner une « super-priorité » aux retraités. Actuellement, ils sont considérés comme des créanciers ordinaires, ce qui ne leur laisse que des miettes une fois que les autres se sont servis.

(…) Mais les entreprises qui ont un régime de retraite déficitaire ne devraient pas avoir le droit de racheter leurs actions, à plus forte raison si elles ont reçu l’aide du gouvernement. Pourquoi les cadeaux aux actionnaires passeraient-ils avant les promesses aux retraités ?

À la prochaine…

Dans FastCompany, le journaliste Christopher Zara publie un intéressant article reprenant une étude menée actuellement par The Conference Board sur la réduction des rémunérations : « Pandemic pay cuts: The growing list of companies reducing salaries during COVID-19 ». Le constat est éloquent pour l’application de la RSE et de la théorie des parties prenantes par les entreprises, je vous le laisse découvrir ci-dessous :

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More than 30 million Americans have filed for unemployment benefits since the economy first began to unravel due to the coronavirus pandemic. That figure may not count untold millions of freelancers or self-employed individuals who are also out of work, nor does it factor in countless people who simply couldn’t get through to their state labor department to file a claim. And of those who are still working, many are making considerably less money due to reduced hours.

And then there are the company-imposed pay cuts. Over the past few weeks, the Conference Board has been tracking pay reduction announcements for publicly traded companies, using SEC filings by firms listed in the Russell 3000 Index.

Some the findings may surprise you: For instance, the salary reductions are not just hitting top executives and their fat bonuses. At last count, 61% of the affected companies applied pay reductions to the base salaries of senior managers who make less than top-tier executives, the Conference Board says. It adds that 11% of all companies in the index announced base pay cuts between March 1 and April 24.

The good news is, the announcements peaked in early April and have declined a bit in recent weeks. The bad news? The group anticipates a “second wave” of salary reductions could emerge in the weeks ahead as the ripple effects of COVID-19 continue to wreak havoc on bottom lines.

The Conference Board posted the insights in a new report that also includes a wealth of data visualizations and the full list of companies. It says the list will be updated weekly as long as the crisis continues. The data is being compiled in collaboration with consulting firm Semler Brossy and Esgauge Analytics. It shows that the industries hardest hit by the coronavirus are what you would expect, including retail and hospitality.

À la prochaine…