FRIDAY WRAP: Exxon sues their owners, Florida bans social media, the Empty Chair at Starbucks, billionaire insider trading, and Dwayne Johnson wins

IT’S FRIDAYYYYY!!! And we are LIVE, and ALIVE. This is Ari the Data Queen, joined by AnalystHole Matt Moscardi, Jessie the Money Whisperer, and Hazelnut Rallis. On today’s weekly wrap up: pointless furniture, greedy God and UPLIFTING BILLS!!!!!

Story of the Week (DR):

1. Exxon Sues Two ESG Investors AB MM

1. The oil giant says Arjuna Capital and Follow This want Exxon’s oil-and-gas business to shrink, putting them at odds with shareholders

2. Exxon’s decision to seek legal judgment rather than go through the SEC is highly unusual and marks an aggressive pushback against climate activists who use shareholder voting to influence boardroom strategy.

2. Dwayne Johnson joins TKO's board of directors

1. Dwayne "The Rock" Johnson was appointed to the TKO board of directors on Tuesday, as he appears ready to return to the ring to face off against the Undisputed WWE Universal Champion Roman Reigns.

2. He also entered into a Services Agreement in which he will receive $30M in stock

3. Patriarchy wins again as Oscars snub ‘Barbie’ star Margot Robbie and director Greta Gerwig but nominate ‘Ken’

4. The Empty chair at Starbucks: How unions are fighting a boardroom battle at Starbucks JS

1. There is a famous story about Starbucks that is often cited during discussions of governance: at board meetings, there is an empty chair to represent the interests of the coffee giant’s employees.

2. The idea was proposed by its founder and  former CEO Howard Schultz to show that the company’s baristas have a symbolic seat at the table.

Goodliest of the Week (AB):

1. Southwest Airlines flight attendants vote to approve strike authorization

1. Southwest!! The company that up until the 2022 holiday season had us all believing that it was peace and love, with hearts all over their marketing and their ticker name LUV saying how much they LOVE their employees, “happy employees = happy customers”.. Well I guess their relationship status is complicated right now. 98% of flight attendants belonging to the Transport Workers Union of America voted to authorize a strike against the company… for the first time ever

2. Didn’t they just approve a new labor agreement that will see a 50% pay raise over 5 years? NOPE. That was pilots only. Flight attendants want a piece of the pie as well.

2. 'Outrageous' CEO pay targeted in new bill from Bernie Sanders, US Democrats DR

1. A BILL TO LIMIT CORPORATE GREED

2. DO NOT TELL ME THIS IS NOT GOOD BECAUSE IT’LL NEVER PASS

3. So directors that pay their CEOs over 50x the typical worker’s salary, would expect to pay higher taxes under this bill. 50X! That’s a ton of companies in the S&P500 considering the average for 2022 was 272:1

4. At the top of the 2022 list was Live Nation with a 5,414:1 

5. other examples: Coca Cola 1883:1, McDonalds 1224:1, Apple 1177:1

3. Florida House passes a bill to ban social media accounts for children under 16 MM JS

1. SOMETHING GOOD FROM FLORIDA.

2. “Florida children under the age of 16 would be banned from popular social media platforms regardless of parent approval”

3. “They’re taking advantage of kids growing up. That’s their business model. And why do they do it? To keep them hooked ... with the dopamine hits that the platform gives our children with every autoplay, with every like, with every push notification,” said bill sponsor Republican Rep. Tyler Sirois.”

4. “Republican House Speaker Paul Renner said the Florida bill should withstand constitutional scrutiny because it targets the addictive features of social media, and not the content”

Assholiest of the Week (MM):

1. Ortenca Aliaj and Patrick Temple-West, who framed employees want a not-empty seat at the table of Starbucks as a “social agenda” DR JS

1. The authors of How unions are fighting a boardroom battle at Starbucks - Financial Times

2. Howard Schultz was happier having an empty chair to represent employees than an actual employee, but the authors draw a line to:

1. “I do think this is the campaign we have been waiting for and worried about,” says one adviser to large public companies. “Single-issue activists advancing a social agenda.”

2. Not only must companies contend with challenges from the traditional hedge funds, which have long stalked their decision-making, they must also prepare themselves for proxy fights from outfits seeking to reshape their social agendas.

3. THIS IS NOT A “SOCIAL AGENDA”

1. Republican SEC commissioner Hester Peirce worried that it was too easy for frivolous activists to get board nominees on a company’s ballot. An investor passionate about issues involving bees, she argued, would have leverage to demand companies “put beehives on the roof of each office building”.

4. Non binding votes? Actual  investors whose votes are commensurate with share ownership?  That would mean HALF OF INVESTORS WANT BEEHIVES

5. Meanwhile…

1. Disney, for example, is facing a conventional campaign led by activist investor Nelson Peltz as well as a more radical one from a smaller investor, with a minor stake, which has stormed in with its own board nominations.

6. Nelson Peltz borrowed shares and has a strategy that differs from Disney in that Disney said they want streaming to be profitable, but Peltz’s strategy is “competes with Netflix”

7. The whole framing of this article diminishes the fact that a union quashing, billionaire led holocaust blanket of a company has denied employee rights and focuses instead on the TOOL used by and INVESTOR to get it on the ballot?  Shame on you assholes.

2. Skills matrices

1. From The Big Vote segment on the next Proxy Countdown - here’s a story no one anywhere cares about, but should be a story

2. We’re covering Apple’s upcoming AGM, and I noticed something weird doing the research - in most of the proxies now the directors have a “skills matrix” which is a check-the-box board of expertise

3. Turns out no one reads them, because if they did, they’d find that you can put whatever you want on even if you have OPPOSITE skills in another company’s skills matrix

4. So here’s Apple’s board:

1. Levinson (no boards)

2. Cook - consistent

3. Gorsky - consistent

4. Andrea Jung

1. Apple - financial expertise, no tech expertise, no government expertise

2. Unilever - no financial expertise, tech expertise, “geo political” expertise

5. Wanda Austin

1. Apple - financial expert

2. Amgen - not financial expert, not international affairs expert, not public CEO

3. Chevron - international affairs expert

4. Virgin Galactic - financial expert, public CEO

6. Monica Lozano

1. Apple - no E expertise

2. Target - ESG expertise (maybe just S and G?)

7. Ron Sugar

1. Apple - no government/policy expertise, no environmental expertise

2. Uber - government/policy expertise

3. Amgen - government expertise

4. Chevron - government expertise, environmental expertise

8. Sue Wagner

1. Apple - brand/marketing expertise

2. Blackrock - no brand/marketing expertise

3. Samsara - brand/marketing expertise

3. Financial Reporting Council

1. ESG removed from UK Corporate Governance Code - HR Magazine

2. City minister Bim Afolami insists: "There's no point having the safest graveyard." I shared some thoughts on all this.

1. Alternatively, there’s no point in having governance rules when Earth is a graveyard?

3. The focus is misplaced - “ESG” wasn’t “removed”, the PEOPLE who wrote the consultation document were different from the PEOPLE who wrote the final document

1. The CEO of the FRC was Sir Jon Thompson, a lifelong bureaucrat and liberal affiliated civil servant for the first draft 

2. He was replaced by conservative appointed Richard Moriarity

1. Minister Kevin Hollinrake appointed him - Hollinrake has argued that they should frack for natural gas in Yorkshire, voted against same-sex marriage, and once said it’s parents who should feed hungry kids, not charity from a footballer

4. I don’t agree with having ESG all over the regs frankly, but mostly, where’s the fucking reporting on WHO removed ESG and why?

4. Dave Calhoun AB

1. Mr. Calhoun visited the Spirit AeroSystems factory last week — a plant that the plane maker sold in 2005. And Boeing said this week that it was planning to hold a “quality stand-down” on Thursday, during which production, delivery and support teams would stop work to attend learning sessions on quality.

2. IT’S THE EMPLOYEES FAULT I DON’T KNOW HOW TO BUILD AIRPLANES

Exhausting-est of the Week (JS):

1. GOP Rep (Andy Biggs AZ) Says ‘Woke DEI Programs’ to Blame for Airline Problems DR

1. We’ve now heard this accusation from so many different people that I’m utterly exhausted by it

2. The golden quote from old, white Rep Biggs: "There have been too many close calls with major airlines recently. Woke DEI programs are placing unqualified pilots into airplane cockpit. These airlines need to be prioritizing safety over diversity quotas," Of course he shared this thought on X.

3. It’s old, crusty, stale boards and the cutting of costs and safety measures that causes airline problems!!!!!! NOT DEI

4. These airlines should be prioritizing safety over profit

2. Billionaire Joe Lewis says he's 'embarrassed' by knowingly committing securities fraud after pleading guilty to the crime MM JS 

1. He’s just embarrassed that he was caught!!

2. This statement from his lawyers exhausts me: "The government has made an egregious error in judgment in charging Mr. Lewis, an 86-year-old man of impeccable integrity. Mr. Lewis has come to the US voluntarily to answer these ill-conceived charges, and we will defend him vigorously in court."

3. Ill conconceived charges??? Lewis admitted, in court, that he tipped off acquaintances with inside information from publicly traded companies where he was a large investor…that’s ILLEGAL!!! How are these charges ill-conceived???!?!?

4. If Lewis is not charged it will just confirm that billionaires can do and get away with whatever they wants

3. Commiting crimes in the name of God: Pastor Charged With Cryptocurrency Fraud Said God Told Him to Do It AB

1. A Denver pastor, Eligio Regalado, and his wife marketed a digital coin that prosecutors said was “practically worthless” and pocketed more than $1M. They used the proceeds to support “a lavish lifestyle”

2. Regalado created a video addressing the civil complaint filed in Denver’s District court saying that he went into the cryptocurrency business because “the Lord” told him to. He continued by telling his Christian investors, “They have to do this. I mean, if you think about this: … We took God at his word and sold a cryptocurrency with no clear exit.”

3. He and his wife spent a few hundred thousand dollars of the funds on “a home remodel that the Lord told us to do.”

4. Mr. Regalado said that he still hoped that investors could get their money back, and that he believed “God is going to work a miracle in the financial sector.”

Who Won the Week?

1. DR: The empty chair

2. AB: Women! According to Yelp, Women were the largest demographic of new business owners in 2023

3. MM: The Rock - $30m for a rubber stamped vote!

4. JS: Peacock- reports 2.8M subscribers for NFL playoff game

Predictions

1. DR: In order to get his 25% stake in Tesla, Elon trades his CEO title and brother: becomes Exec Chair/Kimball gone

2. AB: Average salary for Chief Marketing Officers is gonna take a nosedive for 2 reasons 1. As a way to distract from CEO pay and 2. Women outnumbered men in CMO jobs for the first time in 2022: representing 70% of new appointees. 2023 saw UPS, Etsy, Walgreens (among others) eliminate the CMO position altogether. 2024 will see more of that plus pay cuts. ADD-ON PREDICTION: COMPANIES WILL DECREASE THEIR OUTRAGEOUS CEO PAY RATIOS BY HIRING WOMEN FOR THE JOB.

3. MM: We see a rise in nominations of empty chairs for boards that represent things

4. JS: