The joke of meritocracy, unhalted engagements at Blackrock, and Coca-Cola's DEI double down

Introduction

LIVE from your ESG and DEI Teeth Bleaching Kit, it’s a Business Pants Friday Show here at February 21st Studios, featuring AnalystHole Matt Moscardi. On today’s weekly wrap up: Canada still cares, Rupert Murdoch knows how to text, the illusion of meritocracy, and an important new announcement from YouTube

Our show today is being sponsored by Free Float Analytics, the only platform measuring board power, connections, and performance for FREE.

Story of the Week (DR):

1. ESG Week MM

1. BlackRock and Vanguard halt meetings with companies after SEC cracks down on ESG

1. BlackRock resumes stewardship talks after reviewing new ESG guidance

2. Proxy vote support for ESG drops to record low in 2024

1. Clarification: ShareAction analyzed how 70 of the world’s largest asset managers voted on 279 ESG shareholder resolutions during the 2024 proxy voting season:

1. In 2024, only four (1.4%) out of the 279 resolutions we assessed received majority support, less than half of the percentage that gained a majority vote in 2023 (3%), and far lower than the 21% which passed in 2021.

2. This is reflected in an ongoing downward trend in the average percentage support that these resolutions received, which was 20.6% in 2024 compared to 40% in 2021.

3. Vanguard, the world’s second largest asset manager, performed the worst of all the managers we assessed, voting in favour of 0% of shareholder proposals.

1. Top 26 all in Europe

1. 1 GenAM (Italy) 98

2. 2 BNP Paribas Asset Management (France) 97

3. 3 PGGM Investments (Netherlands) 97

4. 28 Federated Hermes (top in US) 80

2. BlackRock at #67 with a score of 5; Vanguard to out of 70 with a 0.

2. Tesla Targeted With Worldwide Protests, Vandalism

1. Tesla showrooms are being hit by a wave of anti-DOGE protests

2. Sheryl Crow says goodbye to her Tesla and donates to NPR: 'You have to decide who you are willing to align with'

3. Sign That Says “We Hate Him Too” Appears in Window of Tesla Dealership

4. Economist Warns That Elon Musk Is About to Cause a "Deep, Deep Recession"

1. Jesse Rothstein, DOL's chief economist at the start of the Obama administration: "This is going to be very, very bad."

3. James Murdoch lays bare his relationship with ‘misogynist’ father amid succession fight in rare interview

1. The interview, published in the Atlantic, reveals James Murdoch, now 52, regarded his father, now 93, as a “misogynist” and described Fox News as a “menace” to US democracy.

2. A series of “withering questions” put to James by Rupert’s lawyer in a nearly five-hour session at a Manhattan law office. According to the Atlantic, the questions included:

1. “Have you ever done anything successful on your own?”

2. “Why were you too busy to say ‘Happy birthday’ to your father when he turned 90?”

3. “Does it strike you that, in your account, everything that goes wrong is always somebody else’s fault?”

4. The lawyer also referred to James and his sisters as “white, privileged, multibillionaire trust-fund babies”.

3. James realised Rupert, who was seated silently, was texting the questions to the lawyer. “How fucking twisted is that?” he asks Coppins.

4. UnitedHealth’s rough stretch continues, with buyouts, a reported DOJ probe and a 23% drop in three months

1. UnitedHealthcare is in hot water again as the insurance giant grapples with a reported government investigation of its Medicare billing practices, pursues employee buyouts and potential layoffs and faces sharp criticism from billionaire Bill Ackman.

2. It extends a tumultuous period for its parent company, UnitedHealth Group, marked by the killing of a top executive, a costly cyberattack against its subsidiary and high medical costs.

3. The Department of Justice has launched a civil fraud investigation in recent months into UnitedHealth’s billing practices for its Medicare Advantage plans

1. The probe specifically examines whether diagnoses were routinely made to trigger extra payments in those plans, including at physician groups the insurer owns

Goodliest of the Week (MM/DR):

1. DR: Canadian banks must reveal diversity of board, top managers under new rules

1. Canadian banks and other national institutions have to disclose information about the diversity of their boards of directors and top management under new rules published on Saturday, in sharp contrast with the U.S. Trump administration which is ending such practices.

2. Federally regulated financial institutions must also disclose policies to increase diversity while sending out notices of annual meetings to shareholders.

3. "Investors lack transparent and standardized information on the representation of women, Indigenous peoples, persons with disabilities and members of visible minorities in senior leadership positions … Diversity is fundamental to creating a thriving and successful financial sector that reflects Canadian values."

2. DR: DEI is good for our business, Coca-Cola says

1. In an annual filing, the company said its business could be adversely affected if it was "unable to attract or retain specialized talent or top talent with diverse perspectives, experiences and backgrounds."

3. DR: REVERSAL: Trump rescinds DOT approval for NYC congestion toll, condemns city to pollution

4. DR: REVERSAL: Amazon workers reject union in vote at North Carolina warehouse

1. Of the 3,276 ballots cast, there were 2,447 votes opposing the union and 829 in favor, according to the National Labor Relations Board.

2. CAUSE was founded in 2022 by RDU1 employees Mary Hill and Rev. Ryan Brown to voice concerns about the company’s response to the Covid pandemic, which they viewed as inadequate. The group sought to organize RDU1 to boost wages and secure longer breaks.

1. Starting pay at RDU1 is $18.50 an hour. CAUSE has pushed to negotiate for wages of $30 an hour.

3. Unions have enjoyed increasing support across the country, with 67% of Americans saying they approve of labor unions, according to Gallup.

1. North Carolina had the lowest union membership rate in the country last year, with only 2.4% of workers in the state represented, according to the BLS.

5. MM: NASA Has Some Good News About The Asteroid That Could Hit Earth

6. MM: Finally, a future lawsuit against return to office mandates is here: Afternoon Naps Boost Your Problem-Solving, Study Finds

1. 110 minute nap!!

7. MM: What's in that drink? Starbucks becomes less Instagrammable. MM DR

Assholiest of the Week (MM):

1. Meritocracy, the new buzzword DR

1. Exxon Swaps 'Diversity' for 'Meritocracy' in Report to Investors

2. According to our data, ONE of Exxon’s TWELVE directors meets relatively unimpeachable “merit” measures: advanced knowledge of the industry, network power, economic interest in the company, performance (earnings and TSR) at any company board they sit on, and CEO or leadership positions in the past.

3. The ONE member that hits three of the five is Kaisa Hietala, who was a dissent director put there by Engine No 1 in an activist vote

4. Here’s why merit’s missing: 7 of 12 directors are white men

1. There are no people of color anywhere except the two twofers - the woman born in Egypt who lived in Texas her whole life and was part of Trump 1.0, and the black guy on three other boards?

5. Our data shows on average black women have more merit on paper than any other cohort

6. New plan: companies need to announce “increased meritocracy targets” - increasing the number of employees, executives, and directors meet meritocracy requirements by 2050

1. The result will be: 100% of every company is black women

2. You’re welcome

2. It’s your job, asshole

1. Boeing CEO praises Elon Musk for helping with the delayed Air Force One delivery: 'He's a brilliant guy'

2. Your literal job is to build that thing for a client - imagine if we developed sucky director data, then said we hired ISS to build it because, “they’re better at it!”

3. Investors - you elected this board, this fool, and it’s your money - is your job as owner the company to keep on a board and management team that needs help to do its basic job?

1. Just a reminder: Ohio AG sued Boeing’s board for safety failures - they can’t keep their planes safe, they can’t build new planes, they can’t figure out how to deal with their employees… and the lowest vote against wasn’t for prior CEO Dave Calhoun, it was for the guy who chaired the safety committee… for one year!

2. Ohio voted FOR THEM ALL

3. What it was always about

1. The worst version of fuck, marry, kill… fuck anyone with a vagina since you’re a middle school boy, marry money, and kill… people

2. An Influencer Says She Had Elon Musk’s Baby and the Drama Is Pretty Spectacular, Even by His Standards

3. Elon Musk has a problem with X's Community Notes when he disapproves of the results

4. Elon Musk Is Flagrantly Gutting an Agency in Charge of Regulating Tesla

1. Tesla recalls more than 375,000 vehicles due to power steering issue

Headliniest of the Week

1. DR: Zuckerberg's New Metaverse Ad Is So Bad That the People Who Created It Must Be Secretly Trying to Embarrass Him

2. MM: YouTube picked a new shade of red for its logo because the old red was too red - because the old color, hex code #FF1B1B was super loud and diverse, they made it a less diverse woke red, hex code #EB2F3B

Who Won the Week?

1. DR: NYC pollution

2. MM: Investor Relations Teams: BlackRock and Vanguard halt meetings with companies after SEC cracks down on ESG.  BlackRock resumes stewardship talks after reviewing new ESG guidance.  Not said but implied: “don’t worry, we totally can’t actually do stuff now, we’re just talking here”

Predictions

1. DR: Robbie Starbuck sues Coca-Cola because color of Coke is “too DEI”

2. MM: Apple, prior to their upcoming meeting, sues Inspire Investing and Wayne Franzten, who copy pasted a shareholder proposal submitted by Bowyer Research, the company propped up by ISS, to Deere for a meeting in the same week.  The lawsuit is on the grounds that Wayne Franzten doesn’t exist (the only search result for his name is the Apple proposal, not even in voter records or political donation or real estate records can I find him - and this is his ONLY shareholder proposal in our database EVER), and on the grounds that a religious investor cannot sue on the grounds of financial materiality since Jesus said, “Children, how hard it is to enter the kingdom of God! It is easier for a camel to go through the eye of a needle than for someone who is rich to enter the kingdom of God.” | Mark 10:24b-25 and  “Watch out! Be on your guard against all kinds of greed; life does not consist in an abundance of possessions.” | Luke 12:13-15, which means churches are anti-shareholder value.