Homepage / Currency / An epic but inconsequential proxy vote at Procter & Gamble
Google and Facebook are watching our every move online. It's time to make them stop Daymond John tells shy airline passenger: You should have talked to me on the plane South Korea says it has no plans to shut down cryptocurrency trading AMD shares surge as Wall Street analysts say the chipmaker is ‘executing on all fronts’ James Altucher, the face of bitcoin, says he’s happy about Facebook’s cryptocurrency ad ban Pending home sales eke out 0.5 percent gain in December as supply shrinks to record low Uber is testing bike sharing in San Francisco The real source of the internet's problems might be the advertising business Game publisher EA's sales forecast tops estimates, sending shares higher GE will likely be dropped from the Dow, Deutsche Bank predicts Samsung surpasses Intel as world's biggest chipmaker for the first time Apple could be the best of the bunch in this tech earnings avalanche The 9-year stock rally still has 'years left,' says one of Wall Street's most bullish strategists Apple: We would never degrade the iPhone experience to get users to buy new phones Bitcoin headed for biggest monthly drop since January 2015 with nearly $60 billion of value wiped off ADP boosts forecast as new tax law spurs demand China 'will open even wider to the UK,' says Prime Minister Li Keqiang Big market swings are something you’re going to have to get used to, says Wells Fargo The dollar keeps weakening. Is that good news for the world? Apple downgraded by BMO, expects iPhone maker to slash revenue forecast this week SoftBank buys majority stake in Japanese messaging giant Line’s mobile division Rising interest rates cause a 2.6% pullback in weekly mortgage applications Trump's State of the Union address 'less hard' than first feared in Asia Trump vows to protect US intellectual property, without naming China Blockchain technology to boost Microsoft earnings, trader says Fujifilm to take over Xerox and combine it into the joint venture Fuji Xerox Samsung is making chips designed to mine cryptocurrencies like bitcoin There’s a risk of market turbulence, but it’s unlikely to hit until 2019, says Santander chairman We'll see up to a 15 percent correction in 2018, Swiss bank CEO says Japan's biggest messaging app Line is planning to launch a cryptocurrency exchange Quicksilver surfwear CEO missing at sea off the coast of France Venezuela says will pre-sell 'petro' cryptocurrency on Feb. 20 Nintendo ups its Switch sales expectations to 15 million units after profits rise 261% European markets seen mixed amid earnings and economic data The UK wants free trade with China. Beijing has its own goals Santander fourth-quarter net profit down 4 percent on US impairments The man who almost became ambassador to South Korea just warned about US plans for North Korea China's Leshi Internet flags $1.8 billion loss for 2017, citing conglomerate cash crunch South Korea says it uncovered about $600 million in cryptocurrency crimes Asia became less democratic in 2017 Al Gore's investment firm backs start-up created by Facebook co-founder Theresa May says she wants a free trade deal with China Chinese manufacturing weaker than expected in January Webpass is leaving Boston in latest sign of Google Fiber’s shrinking ambitions Samsung posts record fourth-quarter profit Asian shares look set for more declines as Wall Street sells off for a second day Don't count insurers out yet after Amazon-Berkshire-JP Morgan move Amazon's health care move could be a big win for consumer health start-ups Red Hat buys CoreOS, a start-up that sold tech developed by Google Here’s what Amazon told employees today about its landmark deal to deliver better health care Top official resigns after false missile alert in Hawaii Crazy odds: These online traders bet on the chaos of Washington and the Trump administration AMD falls despite beating Q4 estimates Facebook ban on bitcoin ads latest in very bad day for cryptocurrencies Indian man dies after being sucked into an MRI machine while carrying an oxygen cylinder Advice for Jeff Bezos, Warren Buffett and Jamie Dimon from a failed effort to control health costs Toys R Us poor holiday sales cast doubts on its future and could force renegotiation of loan terms The Apple sell-off is a buying opportunity into earnings, says trader Google partnership on mobile cloud services drives up MobileIron shares Facebook is banning all ads promoting cryptocurrencies — including bitcoin and ICOs Amazon's moves in health care over the last year are finally starting to make sense Buffett is getting a second chance to partner with Bezos after missing on Amazon as an investment How Pencils of Promise got a $1 million donation from an anonymous bitcoin multi-millionaire Amazon's home devices could be a key to cheaper health care, tech investor Roger McNamee says Two ex-Google engineers built an entirely different kind of self-driving car Cryptocurrencies join the global financial market sell-off as bitcoin drops 7% A travel agent is trying to charge fees for sunbeds Most of the tax cut windfall will boost buybacks and dividends, not workers' pockets, survey predicts The professor who wrote the book on making addictive technology is having second thoughts Trump's immigration policies are 'economic poison' that will cost taxpayers billions Airbnb trolls President Trump ahead of the State of the Union The iPhone X's $1,000 price tag scared everyone away Drop, a rewards app start-up, snags Airbnb's former head of engineering SEC halts one of the largest 'ICOs' ever as it wades deeper into the murky world of cryptocurrency offerings Passing on sanctions, Trump goes even softer on Russia than expected Buy insurers on dip as new initiative from Amazon, Berkshire and JP Morgan is ‘more bark than bite’: Analyst High schools stock up on Narcan to combat teen opioid crisis in US Apple will finally replace the fax machine in health care Apple is reportedly delaying new iOS features until next year because of quality problems Bond expert predicts a ‘wall of buying’ in Treasurys will protect the stock market Home prices surge to new high, up 6.2% in November Noted tech investor says the sector is not the best place to invest right now Sterling predicted to hit pre-Brexit vote level before the end of 2018 Stocks making the biggest moves premarket: AMZN, BRKB, JPM, AAPL, BX, TSLA & more Bitcoin boom to give AMD earnings a boost, says MKM Partners Apple shares fall again on another report of fading iPhone X demand Trump advisor Cohn: President to focus on $1.5 trillion infrastructure plan in State of the Union Why don't foreign investors take fright more often? The dollar is doing something it hasn’t done since 1987 UnitedHealth, CVS plunge on Bezos, Buffett and Dimon plan to improve U.S. health care Amazon, Berkshire and JPMorgan Chase to team in landmark new health care company Can earnings afford to slow down? 'Enemies of the USA': Russia slams America's list of oligarchs with ties to Putin The app that exposed the location of military bases with a heat map is reviewing its features For his next act, former Amex CEO Ken Chenault turns his focus on Silicon Valley Child experts: Just say ‘no’ to Facebook’s kids app Ryanair agrees to recognize British pilots union for first time Arab states are 'determined' to stick with reforms despite deepening 'frustration', IMF says The US 'oligarch list' is strikingly similar to Forbes’ richest Russians ranking Indian ride-hailing firm Ola expands to Australia to take on Uber

Currency

An epic but inconsequential proxy vote at Procter & Gamble

SHAREHOLDER meetings in Ohio are not usually the stuff of high drama, but a recent gathering was a nail-biter. Nelson Peltz of Trian Fund Management, an activist hedge fund, sought a seat on the board of Procter & Gamble (P&G), the world’s largest consumer-goods company, in a proxy vote on October 10th. It was the biggest such battle ever. In the weeks leading up to P&G’s shareholder meeting, the fight resembled a political contest, complete with carefully crafted videos, lengthy white papers, mass mailings and tens of thousands of phone calls urging shareholders to vote blue (P&G) or white (Trian).

As The Economist went to press, P&G said it had won and Mr Peltz was contesting the tally. “Everybody but [P&G’s] current employees voted for us,” he said after P&G declared victory. “Maybe that’s why they keep so much overhead.” So the brawl is not over. Yet the outcome may not matter much. Mr Peltz will push P&G for change regardless of whether he wins a board seat, and it is unclear that he will have much effect, be he on the board or off.

  • In “Rest”, Charlotte Gainsbourg explores the sharp edges of grief

  • Taxing the rich

  • The rise of the podcast adaptation

  • Why malaria is spreading in Venezuela

  • Donald Trump’s latest travel ban faces fresh lawsuits

  • How “regularising” undocumented immigrants brings benefits

It is not that Mr Peltz lacks heft. He has taken on consumer firms including Heinz and Wendy’s in the past. Martin Lipton, a lawyer who has long defended companies from such activists, has noted his “impressive record of success with consumer products companies”. Even when Trian technically loses a fight, it often wins. It lost a proxy battle against DuPont, a chemical company, in 2015, but the company went on to make many changes that Mr Peltz had sought. Trian recently won a separate victory, securing a seat on the board of General Electric on October 9th.

At P&G, new thinking is sorely needed. The 180-year-old company sells products in nearly 200 countries and territories. It has America’s bestselling razors (Gillette), toothpaste (Crest), detergent (Tide) and toilet paper (Charmin), to name but a few of its products, but has lost share in more than a dozen of its top categories. Total shareholder return in the five years to February 13th 2017, the last trading day before Trian’s stake (of 1.5%) was announced, lagged the median of its peers by 55 percentage points and the S&P 500 Consumer Staples Index by 27 percentage points.

P&G has taken steps to become more streamlined. In the past three years it has culled its brands from 170 to 65 and reduced the number of employees by 35,000. But Mr Peltz maintains that the firm remains too insular and slow to adapt to a fast-moving market. His frustrations are shared by many institutional investors. Those recently surveyed by Sanford C. Bernstein, a research firm, were particularly critical of the board, which is packed with other bosses, including Terry Lundgren, the chairman of Macy’s, a department store, and Meg Whitman, boss of Hewlett Packard Enterprise, an IT firm.

Institutional Shareholder Services (ISS), an influential proxy-advisory firm, recently noted that the board had presided over bureaucratic tangles and botched acquisitions. Both it and Glass Lewis, another proxy adviser, backed Mr Peltz’s appointment. Many small investors, who own about 40% of P&G’s shares, appear to have disagreed. Employees may have feared bigger layoffs to come. Mr Peltz says he will continue to push P&G even if he fails to prevail in the proxy’s certified vote count.

But his powers may be limited. He is not seeking to sack David Taylor, who became chief executive in 2015 and is thought to be moving P&G in the right direction (albeit too slowly for investors’ taste). Nor is he trying to split up P&G. Mr Peltz’s most substantive change would be to reorganise its ten business units into three, overseen by a lean holding company, to make the firm nimbler. Reorganisation—if the board supports it—could take years to yield results.

Mr Peltz is also urging P&G to acquire more small and local brands. Yet given the mismanagement of prior deals, it is unclear that it would find suitable targets or sustain their growth. Many of the world’s largest consumer firms are struggling—against small online brands on the one hand and the expansion of Amazon and the rise of Aldi and Lidl, two German discount chains, on the other. Dealing with such challenges will require ingenuity and speed not yet seen at P&G. It is far from clear if Mr Peltz has the answers either.

Source: economist
An epic but inconsequential proxy vote at Procter & Gamble

Comments are closed.