Gouvernance rémunération Responsabilité sociale des entreprises
Réduction de rémunération ou licenciement ?
Ivan Tchotourian 27 mai 2020 Ivan Tchotourian
La COVID-19 amène à faire des choix délicats en matière de gestion des RH et des parties prenantes. Le New York Times propose un article intéressant de M. Schwartz intitulé « Pay Cuts Become a Tool for Some Companies to Avoid Layoffs » (24 mai 2020) sur le dilemme entre réduction de la rémunération ou licenciement. La première option semble avoir plus de succès…
Extrait :
It was late and Martin A. Kits van Heyningen feared he was letting the team down at the company he co-founded, KVH Industries. Rather than lay off workers in response to the coronavirus pandemic, he had decided to cut salaries, and when he emailed a video explaining his decision at 3 a.m. last month, he was prepared for a barrage of complaints.
Instead, he woke to an outpouring of support from employees that left him elated.
“It was one of the hardest things I’ve done, but it turned out to be the best day of my life at work,” said Mr. Kits van Heyningen. “I was trying to keep their morale up. Instead, they kept my morale up.”
Even as American employers let tens of millions of workers go, some companies are choosing a different path. By instituting across-the-board salary reductions, especially at senior levels, they have avoided layoffs.
The ranks of those forgoing job cuts and furloughs include major employers like HCA Healthcare, the hospital chain, and Aon, a London-based global professional services firm with a regional headquarters in Chicago. Chemours, a specialty chemical maker in Wilmington, Del., cut pay by 30 percent for senior management and preserved jobs. Others that managed to avoid layoffs include smaller companies like KVH, a maker of mobile connectivity and navigation systems that employs 600 globally and is based in Middletown, R.I.
The trend is a reversal of traditional management theory, which held that salaries were sacred and it was better to cut positions and dismiss a limited number of workers than to lower pay for everyone during downturns.
There is often a genuine desire to protect employees, but long-term financial interests are a major consideration as well, said Donald Delves, a compensation expert with Willis Towers Watson.
“A lot has happened in the last 10 years,” Mr. Delves said. “Companies learned the hard way that once you lay off a bunch of people, it’s expensive and time-consuming to hire them back. Employees are not interchangeable.”
A recent study by the Conference Board with Semler Brossy, an executive compensation research firm, and Esgauge, a data analytics firm, found that 537 public companies had cut pay of senior management since the crisis began. The study did not specify whether any had also cut jobs, however.
To be sure, if the crisis lasts longer than expected and the economy keeps shrinking, it is possible these salary reductions will not be enough to stave off job cuts. Other large corporations have cut salaries as well as jobs to stem coronavirus-related losses.
Still, the sudden nature of the economic threat has created a different mind-set among some managers than existed during the last recession, Mr. Delves said. Some companies did try to cut pay rather than jobs back then, but the impulse seems more widespread now.
“What we’re seeing this time around is more of a sense of shared sacrifice and shared pain,” he added.
When the pandemic hit, HCA was increasing revenue and adding employees, said its chief executive, Sam Hazen, “and to put them out on the street because of some virus just wasn’t something I was going to do.”
With stay-at-home orders covering much of the country and bans on elective surgery in many states, HCA’s hospitals were left with a revenue shortfall. The company suspended its share repurchases and quarterly dividend to bolster its financial position, and it reduced capital spending.
Mr. Hazen donated his salary for April and May to an internal fund for employees in distress, while senior management took a 30 percent pay cut. White-collar employees at lower levels saw their compensation reduced by 10 to 20 percent.
All in all, about 15,000 employees were affected, out of a total of 275,000. The company does not expect the pay reductions to extend beyond June.
HCA also created a pandemic pay program that allowed more than 120,000 nonexecutive hospital employees to receive 70 percent of what they earned before the virus hit. Employees, including union members, are also being asked to forgo a raise this year.
(…) Aon, with 50,000 workers around the world, was even more aggressive about reducing salaries. Top executives there gave up 50 percent of their pay, with most remaining employees getting a cut of 20 percent.
“We wanted to say no one would lose their job because of Covid-19,” said Greg Case, Aon’s chief executive.
Mr. Case said he was heartened because overseas employees, who had the right to reject the salary cuts, overwhelmingly accepted them. About two-thirds of Aon’s work force is outside the United States.
But Mr. Case said the company was bracing for long-term disruption. “The risk on the horizon is potentially much greater than 2008-9,” he said. “We are preparing for scenarios that are multiples worse than that.” Aon says the need for the pay cuts will be reviewed monthly.
Avoiding layoffs will leave Aon better prepared for when the economy does rebound, Mr. Case said. “When clients need us most, we will be there,” he said.
Certainly, for chief executives and the highest-ranking officers, salary cuts are not as painful as it would first appear. That’s because for most, the bulk of their compensation comes in stock awards, said Amit Batish, manager of content and communications for Equilar, a private research firm that tracks executive pay.
“Salaries are a drop in the bucket for most executives, but it does send the message that we are helping out the organization,” he said.
Still, the fact that a few companies were able to avoid layoffs by reducing salaries raises the question of whether more businesses could have averted job cuts in the last two months.
With government unemployment benefits available for laid-off workers, many American companies were quick to cut their work forces, said Kathryn Neel, a managing director at Semler Brossy. “In European countries, where wages were subsidized, they managed to keep more people on the payroll,” she added.
Sharing the pain more broadly this way might have prevented the unemployment rate from hitting its highest level since the Great Depression while also better positioning companies for the eventual recovery.
Firms that cut heavily in 2008-9 were not ready when the economy eventually rebounded, according to Gregg Passin, a senior partner at the human resources consulting firm Mercer. “They lagged companies that were more cautious about cutting people,” he said.
A no-layoffs policy also builds loyalty. “No one wants to be in a situation where their salary is cut,” Mr. Passin said. “But we really do believe the way you treat employees today is the way they’ll treat you tomorrow.”
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engagement et activisme actionnarial Gouvernance normes de droit Responsabilité sociale des entreprises
BlackRock : réflexion sur ses devoirs
Ivan Tchotourian 22 mai 2020 Ivan Tchotourian
Dans ReadClear Markets, Bernard Sharfman critique la dernière position prise par BlackRock : « Does BlackRock’s Shareholder Activism Breach Its Fiduciary Duties? ».
Extrait :
In Larry Fink’s (CEO of BlackRock) most recent letter to CEOs, A Fundamental Reshaping of Finance, Fink lays out a strategy for how BlackRock will use its considerable amount of delegated shareholder voting power to dictate its own vision of what a public company’s (a company traded on a U.S. stock exchange or over-the-counter) stakeholder relationships should be. These relationships represent the management of an enormous number of entities and individuals, entailing much complexity. That is why their management is placed in the hands of those who have the knowledge and expertise to manage them: the company’s management team. In this writing, I argue that BlackRock’s implementation of a strategy of interfering with a public company’s stakeholder relationships (“strategy”) is a form of shareholder activism that may breach the fiduciary duties owed to its investors.
As a means to implement its strategy, a strategy that allegedly is meant “to promote long-term value” for its investors, BlackRock will be requiring each public company that it invests in—virtually all public companies—to disclose data on “how each company serves its full set of stakeholders.” Moreover, noncompliance will not be tolerated. According to Fink, “we will be increasingly disposed to vote againstmanagement and board directors when companies are not making sufficient progress on sustainability-related disclosures and the business practices and plans underlying them.” Based on first-quarter 2020 data, this threat appears to be playing out in reality.
(…)
But what if BlackRock’s strategy is not really motivated by a desire to enhance shareholder value but to attract the investment funds held by millennials and, at least while they are young, their perceived preference for less financial returns and more social activism? Millennials will increasingly be the ones holding most of the wealth in the U.S., making it essential for advisers like BlackRock to start catering to their needs and developing their loyalty now, not later. This is an argument recently made by corporate governance scholarsMichal Barzuza, Quinn Curtis, and David Webber.
Or what if BlackRock’s strategy is used to appease shareholder activists who attack BlackRock’s management? For example, in November 2019, Boston Trust Walden and Mercy Investment Services submitted a shareholder proposal to BlackRock demanding that it provide a review explaining why its climate-change rhetoric does not correspond with how it actually votes at shareholder meetings. The proposal was reportedly withdrawn after BlackRock agreed to give increased consideration to shareholder proposals on climate change and join Climate Action 100, an investor group that targets its shareholder activism at fossil fuel producers and greenhouse gas emitters.
So while BlackRock’s shareholder activism may be a good marketing strategy, helping it to differentiate itself from its competitors, as well as a means to stave off the disruptive effects of shareholder activism at its own annual meetings, it seriously puts into doubt BlackRock’s sincerity and ability to look out only for its beneficial investors and therefore may violate the duty of loyalty that it owes to its current, and still very much alive, baby-boomer and Gen-X investors.
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Gouvernance Normes d'encadrement Responsabilité sociale des entreprises
Crédit d’urgence aux grands employeurs (CUGE) : les précisions
Ivan Tchotourian 20 mai 2020 Ivan Tchotourian
Alexis en a parlé dans un précédent billet, poursuivons donc la discussion entourant le Crédit d’urgence aux grands employeurs (CUGE). En ce 20 mai 2020, le ministre des Finances vient de dévoiler les détails.
Rappelons que pour en bénéficier, les entreprises devront :
- être ni insolvables ni en restructuration;
- ne pas avoir été reconnues coupable de fraude fiscale;
- démontrer ce qu’elles feront pour protéger les emplois et poursuivre leurs investissements au pays;
- publier des rapports annuels indiquant comment leurs opérations respectent les objectifs nationaux du Canada en matière de climat;
- s’engager à respecter les conventions collectives de leurs travailleurs;
- s’engager à assumer leurs obligations relatives aux régimes de retraite.
Des limites fermes concernant les dividendes, les rachats d’actions et la rémunération des dirigeants seront aussi imposées aux entreprises qui se prévalent du programme.
En jumelant l’apport de fonds publics à des conditions susceptibles de dessiner les futurs programmes de relance, le Canada envoie un message fort. Si d’autres États ont adopté une position proche du Canada (Pologne, Danemark, États-Unis), certains ont récemment fait marche arrière pour des raisons obscures (comme la France concernant les pratiques fiscales). Avec cette annonce de Bill Morneau, le Canada prend une posture qui dénote par rapport à sa timidité habituelle vis-à-vis des grandes entreprises (responsables de 27 % de l’emploi au Québec).
Les « plus »
Ces aides vont dans le sens d’une moralisation du capitalisme. Contrôle de stratégies financières court-termistes (touchant la rémunération, les dividendes, le rachat d’actions, les emplois) et exclusion d’entreprises reconnues coupables d’évasion fiscale vont dans le bon sens. La trop grande réserve des États en ces domaines s’est souvent montrée inefficace. À l’heure d’une relance verte voulue et annoncée le 23 avril par le gouvernement canadien, la déclaration du ministre fédéral en faveur d’une divulgation en matière de changement climatique est à marquer d’une pierre blanche. C’est en effet un signal de taille qu’il offre ici en s’inspirant de l’une des 15 recommandations du Groupe d’experts en finance durable qu’il avait lui-même mis sur pied en 2018.
Les « moins »
« Démontrer ce que l’on fera pour protéger », n’est pas protéger l’emploi. Il va donc falloir se méfier de la conformité de façade. Pourquoi se restreindre à la « fraude » fiscale ? Que faut-il entendre par « limites fermes » ? La vérification sera-t-elle faite par l’administratrice du CUGE (Corporation de développement des investissements du Canada) et sur quelle base ? De plus, ce plan d’aide doit aussi déclencher une discussion sur la pertinence d’avoir allégé dans le même temps la surveillance de l’environnement dans le secteur des sables bitumineux en Alberta.
Pour l’annonce du premier Ministre : ici
Pour le feuillet d’information : ici
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devoirs des administrateurs Gouvernance mission et composition du conseil d'administration Normes d'encadrement normes de droit parties prenantes Responsabilité sociale des entreprises
Directors’ Duty under UK Law to Promote the Success of the Company during the COVID-19 Pandemic
Ivan Tchotourian 15 mai 2020 Ivan Tchotourian
Le 30 avril 2020, Philip Gavin s’est interrogé sur l’intérêt de l’article 172 du Company Act pour les administrateurs et dirigeants dans le contexte de la COVID-19 : « Directors’ Duty under UK Law to Promote the Success of the Company during the COVID-19 Pandemic » (Oxford Business Law Blog).
Extrait :
A nuance to director’s duties in the United Kingdom is the expansive statutory delineation of s 172, which endows numerous considerations for directors when acting to promote the success of the company for the benefit of members. Given the unique circumstances of the present-day commercial sphere and the more humanitarian demands being put to businesses, having a statutory foundation upon which to base non-traditional business strategies may assist effective decision-making and financial reporting.
The initial three considerations enshrined within s 172 are (a) the likely long term consequences of any decision, (b) the interests of employees and (c) the need to foster business relationships with suppliers, customers and others. These factors are of particular relevance for firms who sought justification for voluntary shutdown of businesses prior to the wider governmental shutdown.
(…)
Where production changes become quasi-humanitarian in tone and companies internalise cost in the interim, directors may seek justification through s 172(1)(d) and (e), these being the impact on the community and the desirability of maintaining high business standards respectively. Accordingly, directors can seek to frame these quasi-humanitarian efforts in long-term reputational terms, thereby engendering prospective communitarian goodwill.
Furthermore, as political pressure mounts, boards may evaluate reputational factors not simply in terms of market reputation, but also in terms of Governmental co-operation. This is particularly so where companies face increased intervention by public authorities through the Civil Contingencies Act. Comparatively, in a recent memorandum the Trump administration has attempted to exert control over the distribution of ventilators by the multinational conglomerate 3M. Cautious of such intervention occurring within their own enterprises, companies may shift business operations to such an extent to signal their compliance and co-operation with public authorities, thereby disincentivising the wholesale overrule of board discretion.
Within jurisdictions with vaguer duties to act bona fide in the best interests of the company (Delaware, Australia, Ireland), directors may still engage in such quasi-humanitarian efforts. Nevertheless, utilising s 172 to steer directorial judgment may assist effective decision-making, and furthermore guide financial reporting, which mandates s 172 director’s statements. Given that the tenor of 2020 reports will be likely dominated by COVID-19, UK directors will benefit from the homogenising structure of s 172 when making such disclosures in the coming months.
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