Key Governance Developments - September 2019

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Cathay Pacific chairman quits over treatment of Hong Kong protesters

John Slosar has resigned as chairman of Hong Kong-based airline Cathay Pacific after a controversy over the company's alleged willingness to silence employees protesting at China's role in the territory's governance. CEO Rupert Hogg was replaced three weeks ago after the Beijing government and the country's aviation regulator said airline staff who attended Hong Kong protests should not be allowed to work in Chinese airspace. Slosar initially insisted that Cathay would not tell staff what to think, but then dismissed two pilots and said overly radical staff would be suspended from mainland duties.

Best source: Financial Times (subscription required)

 

Shareholders call on BHP to withdraw from groups promoting use of coal

Shareholders have filed a resolution ahead of the annual meeting of Australian-based mining conglomerate BHP calling on it to withdraw from lobbying groups whose aims run counter to the the Paris climate agreement. The motion is backed by Australian private investment firm Grok Ventures and pension funds from the country as well as Britain, Denmark and the Netherlands. BHP is a member of the Australian Minerals Council and the Business Council of Australia, and also supports Coal21, which is planning a massive advertising campaign that seeks to promote the use of coal a matter of national pride.

Best source: The Guardian

 

Mediaset forces through restructuring plan after Vivendi blocked from voting stake

Italian broadcaster Mediaset has succeeded in excluding a trust that holds two-thirds of Vivendi’s 29% shareholding in the company from voting on a corporate restructuring plan, enabling it to obtain a majority for the plan. The strategy would merge Mediaset and its Spanish business into a new Dutch holding company, MediaforEurope, which would forge alliances with other European media groups to offer a common video streaming platform. The French media group headed by Vincent Bolloré opposes the scheme because it believes the new structure disregards corporate governance principles, including a proposed loyalty share scheme that Vivendi says would benefit the family of Silvio Berlusconi, the former Italian prime minister who founded Mediaset. Vivendi, which has been a hostile shareholder in Mediaset since a dispute between the two groups in 2016, says it will challenge the restructuring plan in court.

Best source: Reuters


Deadline for registering beneficial ownership in Luxembourg extended until November

The deadline for companies and non-profit organisations in Luxembourg to submit details of their beneficial ownership to the national register created in March has been extended to November 30. The original deadline was August 31, but just 47% of the country's 129,000 companies and associations had complied with less than a week to go. The EU's anti-money laundering legislation requires member states to establish a beneficial owners’ register to increase transparency. Failure to meet the deadline will make organisations liable to a €15 per late entry charge and potentially fines of up to €1.25m. Remy Bonneau, a corporate lawyer at Linklaters, says the new deadline does not legally protect non-compliant firms that missed the original date from penalties, noting that the extension is solely an administrative decision.

Best source: Paperjam (in French)

See also: Delano

See also: Luxembourg Times (subscription required)

 

Swedish state pension fund dismisses CEO over trading rule breaches

The board of Swedish state pension fund AP1 has dismissed CEO John Magnusson with immediate effect for the violation of internal regulations on the holding and trading of financial instruments, although it says no crime has been committed. Magnusson has run the fund, one of the country's five state pension institutions, since 2008. Teresa Isele, the fund’s general counsel, has been appointed acting CEO by the board while the search for a replacement is conducted.

Best source: Financial Times (subscription required)