FRIDAY WRAP: Montana kids win on climate, CalSTRS "punishes" directors by doing their job, Hawaiian Electric is the new PG&E, and the Uihleins are billionaire nepos

Introduction

LIVE from your don’t call it ESG walk-in Skittles closet, it’s a Business Pants Friday Show here at August 18th Lane Studios, featuring all your favorites: Ari the data queen, Jessie the money whisperer, AnalystHole-man Matt Moscardi. On today’s weekly wrap up: a CEO mega-options cabal; punishing directors; DeSantis still sucks; and coca-cola-flavored liars

Story of the Week (DR):

1. Ron DeSantis Says He Has “Moved On” And Disney Should Drop Its Lawsuit Against Him

2. ‘Gamechanger’: judge rules in favor of young activists in US climate trial MM DR

1. The judge who heard the US’s first constitutional climate trial earlier this year has ruled in favor of a group of young plaintiffs who had accused state officials in Montana of violating their right to a healthy environment.

3. The solution to ESG’s unpopularity? Call it something else and hope no one notices

1. Scott Ball is a Senior Staff Writer for Resourceful Finance Pro

1. “Perhaps the No. 1 proponent of ESG is Larry Fink”

2. “Selling the benefits of ESG to average investors is tough and getting tougher. For example, try explaining to the average investor how credit rating agencies gave ExxonMobil a higher ESG score than Tesla. Good luck.”

1. Here are two headlines I pulled just this week:

1. Tesla didn’t fix autopilot after fatal crash, engineers say

2. Ex-Tesla workers describe Elon Musk's 'production hell' in their own words, from working through a raw sewage leak to sleeping on the factory floor

2. From Bloomberg: About two-thirds of respondents in a survey said the anti-ESG movement will force firms to stop using those three letters in conversations with clients. However, they’ll continue to incorporate environmental, social and governance metrics in their business.

4. 2 Pinterest Directors Resign From Nextdoor's Board In Response To Antitrust Enforcement Efforts JS

1. The Justice Department said Wednesday that two directors resigned from Nextdoor's board in response to the department's efforts to enforce an antitrust law aimed at barring executives from holding similar positions at rival companies.

2. 8-K said zero

3. The two directors are Leslie Kilgore and Andrea Wishom

1. And they might be part of a CEO mega option grant cabal

4. FFA

1. Pinterest: Brotatorship: Evan Sharp (32%); Benjamin Silbermann (43%)

1. FPG: 27/8

2. Leslie Kilgore (3%) and Andrea Wishom (3%)

1. Both members of Pay committee; Kilgore chair

1. CEO Bill Ready: $122M last year, including 8.6M options ($19.96) valued at $100M

1. If share price gets back to $86 2 years ago options worth over $500M

2. Nextdoor: Dicktatorship: Nirav Tolia (60%)

1. FPG: 40/26 (this includes CEO Sarah Friar (16%))

2. Leslie Kilgore (6%) and Andrea Wishom (2%)

1. Both members of Pay committee; Kilgore chair

1. 2.4M options ($6.06) for CEO in 2022; 2.6M options ($2.41) in 2021

1. If share price gets back to $13 less than 2 years ago options worth nearly $50M (roughly $500M if they get to Pinterest’s share price)

Goodliest of the Week (AB):

1. CalSTRS escalates efforts to hold global companies accountable for not adequately disclosing climate change risks; votes against 2,035 boards of directors in proxy season 2023 JS DR MM

1. There are 9,000+ companies globally - assuming their universe is roughly the MSCI ACWI, CalSTRS voted against around 20% of boards GLOBALLY… WHO’S AGGRESSIVE NOW!

2. You have a good excuse to turn off your camera during Zoom meetings—it’s better for the environment

1. Going off camera reduces the carbon footprint of a videoconferencing session by up to 96%, according to one study.

3. Major brands are pulling advertising after posts appeared beside pro-Nazi content

1. This week Media Matters, a not-for-profit research and insight site, published a report appearing to show posts from major global brands being unknowingly promoted on a pro-Nazi profile.

2. Since then numerous companies have withdrawn their advertising from the platform—with others adding their posts had been promoted without ever paying for the service.

3. It comes less than a week after Yaccarino promised companies their brands would be safe on the platform, reporting: “Since acquisition, we have built brand safety and content moderation tools that have never existed before.”

Assholiest of the Week (MM):

1. I mean, they’re not even TRYING not to be assholes…

1. Conflict': DeSantis ally can't lead both ethics board and Disney ... - Tallahassee Democrat

2. World Chess Bans Transgender Players From Women’s Events—Joining Sports Like Swimming

2. Hawaiian Electric Knew Wildfires in Maui Were a Growing Risk, But Waited Years to Act JS MM

2. First thing to know: this is a bizarre woman - to - woman glass cliff CEO

1. Connie Lau steps down in 2021, CEO jobs split between Hawaiian Electric (new CEO Shelee Kimura joined in early 2022) and American Savings Bank (Hawaiian Electric subsidiary since 1998, Scott Seu becomes CEO)

2. Lau was on the board, but Kimura is NOT added to the board while Scott Seu IS added to the board

3. The glass cliff result: goes from an average +5% female power gap to one of the WORST at -14% today

3. Here’s who was responsible:

1. Thomas Fargo, 75 yo retired military, professional director for military contractors, has had on average 23% of the board influence since 2018, has been on the board since 2005

2. 27% of the board are connected to one another, conservatively

4. Says “wildfires” are a risk twice in 10Ks… for a decade

1. Between 2019 and 2022, it invested less than $245,000 on wildfire-specific projects on the island, regulatory filings show.  

3. Suncor has been too focused on energy transition, must get back to fundamentals: CEO - Financial Post DR

1. The man hired to turn around the flagging fortunes of Suncor Energy Inc. said Tuesday he believes the company has been too focused in recent years on the energy transition and must get back to an oil-centered business strategy.

2. Chief executive Rich Kruger, who took the reins at the Calgary-based energy giant this spring, told analysts on a conference call that the company’s board of directors agrees with him that a “revised direction and tone” at the company is necessary.

3. Here’s the board as it was - the one that DIDN’T approve of lighting the atmosphere on fire for shareholder value:

1. +8% gender power gap!

3. Elliott Management, everyone’s favorite Africa Dorsey hating, Elon loving activist hedge fund, takes a stake and Suncor cuts a deal, cuts the most powerful woman on the board, adds cronies to the sustainability committee, and the crony they add is a lifetime oil driller engineer!  

4. NOW… gender power gap flips to -8%! Elliott owns substantial portion of influence!  Going back to tar sands!

Exhausting-est of the Week (JS):

1. Why it’s more expensive for Black towns to borrow money

1. When cities need to raise money for roads and water lines, they can: 1) Raise taxes or 2) Issue bonds. These municipal bonds function like loans that banks and investors make to local governments as a tool to fill out city budgets

2. It’s how sewage, water, public schools and services are funded

3. A paper published last week confirmed that it also helps perpetuate systemic racism- When Black towns and cities try to borrow money on the bond market, they pay higher interest rates than their white counterparts.

4. This is exhausting because the US financial system has been perpetuating systemic racism basically since our inception

5. Author of the paper, Erika Smull: “The inequality in the bond market perpetuates a cycle of debt and disinvestment in Black communities, but it also has huge implications for environmental justice and climate resilience.”

2. Now we can’t online shop or even ship things if we have a conscience MM JS

1. The story behind Uline, the packaging powerhouse whose reclusive billionaire owners use their fortune to influence American politics

2. The story isn’t important- Uline is a mammoth, bringing in about 6B in sales/year

3. Billionaire founders, the Uihleins, support far-right-wing candidates, including Trump, and their family foundation gave more than $5 million to groups that disputed or worked to challenge the legitimacy of the 2020 presidential election

4. Most recently, the Uihleins have thrown their financial heft behind the presidential campaign of Florida Governor Ron DeSantis, and the American Principles Project, which opposes abortion rights, critical race theory, and transgender rights.

5. At least there are people seeking alternatives: R/small business thread: What's a good alternative to Uline that doesn't support extreme right wing politics?

3. Drop your diet coke…like right now. Drop it. DR

1. Back story: In May, the World Health Organization issued an alarming report that declared widely used non-sugar sweeteners like aspartame are likely ineffective for weight loss, and long term consumption may increase the risk of diabetes, cardiovascular diseases and mortality in adults.

2. A few months later, WHO declared aspartame, a key ingredient in Diet Coke by the way, to be a “possible carcinogen”, then quickly issued a third report that seemed to contradict its previous findings – reporting that people could continue consuming the product at levels determined to be safe decades ago

3. So obviously this confused people and advocates did some digging

4. They uncovered eight WHO panelists involved with assessing safe levels of aspartame consumption are beverage industry consultants who currently or previously worked with the Coke front group, International Life Sciences Institute (Ilsi).

5. A glaringly obvious conflict of interest

Who Won the Week?

1. DR: Caroline Ellison

1. kept a memo called ‘Things Sam Is Freaking Out About,’ and prosecutors plan to use it against the FTX founder

2. MM: PG&E - from 2017 to 2022, PG&E was responsible for 30 wildfires that killed more than 100 people, but thanks to Hawaiian Electric, NO ONE CARES ANYMORE!  AMIRITE?!

3. JS: COVID won the week in our household

Predictions

1. DR: After AOC wins the presidency in 2050 she appoints me as SEC chair: my first order of business is to require disclosure of “Things The CEO Is Freaking Out About”

2. MM: CalSTRS buys Free Float Analytics data this year and votes against at least one director at 9,533 boards out of 9,533 boards globally