Investor Relations Week: What Russia’s exits mean for ESG, Amazon’s stock split and delisting fears resurface in Hong Kong
– According to CNBC, as companies leave Russia at an unprecedented rate, one of the questions posed is where this response to an unprovoked act of war fits into the spectrum of leadership decision-making. Is this a short-lived pause, a sign of a rise in ESG considerations in the C-suite or a significant rethinking of business and economic strategy around the theme of de-globalization ?
For some international business and management experts, current events seem to go far beyond reputation management and a fundamental shift from the post-World War II era characterized by increasingly more global and efforts to reach a global scale. Gary Hufbauer, a fellow at the Peterson Institute for International Economics, thinks the focus on CSR played a role in the rapid response.
“I think we had this period of emphasis on [CSR] and many CEOs and directors theoretically saying they’re all for it,” he says. “With the ‘waking language’ of the moment, they would have a hard time not being in front of the background, their statements and the atmosphere.”
– US President Joe Biden signed an executive order calling on the government to examine the risks and benefits of cryptocurrencies, CNBC reported. This is a long-awaited directive that has put the crypto industry on edge, especially given the growing regulatory concerns around the world regarding the digital asset market. The order calls on federal agencies to take a unified approach to regulating and overseeing digital assets, according to a White House fact sheet. The measures announced Wednesday will focus on six key areas: consumer and investor protection, financial stability, illicit activities, U.S. competitiveness on the global stage, financial inclusion, and responsible innovation.
– The Wall StreetJnewspaper (paywall) reported that Amazon’s board approved a 20-for-1 stock split and authorized the company to repurchase up to $10 billion of its common stock. An Amazon spokesperson said the split will make the split-adjusted share price more accessible to potential investors and provide employees with more flexibility in how they manage stock-based compensation. . The stock split and authorized stock increase are subject to shareholder approval at the company’s annual general meeting, scheduled for May 25.
– Hong Kong shares of dual-listed Chinese companies including NIO, JD.com and Alibaba plunged in trading on Friday after US delisting fears resurfaced, according to CNBC. By Friday afternoon in the city, shares of tech giant Alibaba had fallen 6.56%. Electric vehicle maker NIO, which made its Hong Kong debut a day earlier, saw its shares fall 11.64%. Baidu fell 5.14%, while NetEase fell 6.94%. The losses followed declines in some U.S.-listed Chinese stocks overnight amid renewed concerns about potential U.S. delistings.
The SEC recently named five ADRs of U.S.-listed Chinese companies that it says have not adhered to the Foreign Corporate Liability Act, fueling fears that more companies will be delisted .
– The WSJ reported that the Financial Crimes Enforcement Network (FinCEN) is warning financial institutions and cryptocurrency firms to be on the lookout for attempts to evade sanctions and other restrictions imposed following the invasion of Ukraine by Russia. FinCEN has issued an alert that includes red flags to help financial institutions identify potential sanctions-busting attempts and to remind them to promptly report suspicious activity.
FinCEN said sanctioned Russian and Belarusian entities and individuals could attempt to evade sanctions in a variety of ways, including through unsanctioned Russian and Belarusian banks and financial institutions in third countries. Some signs of possible evasion activity include the use of shell companies to conceal ownership of entities or funds or to conduct international wire transfers.
– The FinancialTimes (paywall) reported that Goldman Sachs and JPMorgan Chase were closing operations in Russia as Wall Street banks followed Western firms in pulling out due to Moscow’s invasion of Ukraine. Goldman announced Thursday its intention to withdraw from the country. JPMorgan, the largest US bank by assets, followed a few hours later. Both said they were acting in accordance with government instructions.
“Goldman Sachs is ending its operations in Russia in accordance with regulatory and licensing requirements,” the bank said in a statement. “We are focused on supporting our clients around the world in managing or closing pre-existing obligations in the market and ensuring the well-being of our associates.” Reuters noted, however, that Deutsche Bank was “constraining the trend” by maintaining ties with Russia, with the news agency saying the bank had faced “strong criticism” as a result.
– The SECOND proposed changes to its rules to improve and standardize disclosures regarding cybersecurity risk management, strategy, governance and incident reporting by public companies. The proposed changes would require, among other things, up-to-date reporting of significant cybersecurity incidents and periodic reporting to provide updates on previously reported cybersecurity incidents.
The proposal would also require periodic reporting on a company’s policies and procedures for identifying and managing cybersecurity risks, the company’s board oversight of cybersecurity risks, and the role and expertise of leadership in cybersecurity risk assessment and management and cybersecurity implementation. – security policies and procedures. In addition, the proposal would require an annual report or certain proxy information on the cybersecurity expertise of the board, if any.
– Credit Suisse has set new targets to nearly halve its exposure to oil, gas and coal emissions financing between 2020 and 2030, according to Reuters. Switzerland’s second-largest bank has reduced its exposure to the emissions it financed in the oil, gas and coal sector by 41% between 2020 and 2021, according to preliminary estimates in its sustainability report, while ‘She had about $2.6 billion in outstanding loans to those customers. . The report marks the first time the bank has detailed its exposure to fossil fuel sector emissions financing, which it estimates at 21.9 million tonnes of CO2e for 2021.