FRIDAY WRAP: Roz Brewer jumps off the glass cliff, Nissan's battery re-use, Tariq Fancy blows HARD, ignoring "fluffy" ESG metrics, and West Virginia's con game

LIVE from your anti-ESG flag pin, it’s a Business Pants Friday Show here at September 1st Studios, featuring all your favorites: Ari the data queen, Jessie the money whisperer, AnalystHole Matt Moscardi. On today’s weekly wrap up: the glass cliff breaks at walgreens, carbon offsets, and batteries, batteries, and more batteries 

Story of the Week (DR):

1. Walgreens CEO Roz Brewer steps down after more than 2 years in the role JS MM

1. The company has been hurt by a decline in Covid vaccine and test demand.

2. She also left the company’s board, effective Thursday. The decision was mutual, according to a news release.

3. Brewer 10% and Walgreens were in a rough patch leading up to Friday’s announcement. Walgreens shares are down more than 32% this year as of Thursday’s close, as the company has struggled with a drop in demand for Covid testing and vaccines. In June, the company reported fiscal third quarter earnings that missed Wall Street expectations for the first time since July 2020. It also slashed its profit guidance for the year.

4. Walgreens said it is searching for a new CEO. In the meantime, Ginger Graham 7%, the lead independent director, will work as interim chief.

2. Vanguard joins BlackRock in backing fewer ESG proposals during 2023 proxy season

1. Investment giant Vanguard has joined BlackRock in supporting fewer ESG-related shareholder proposals during this year’s US proxy season.

2. According to Vanguard, which has $8 tn assets under management, the company supported only 2 percent of ESG-based proposals this year, compared with 12 percent in 2022.

1. Blackrock 7%; 20%

3. Michael Bloomberg made a radical decision to ax his entire board of directors.

1. Michael Bloomberg wasn’t known for board refreshments until last week—when he fired every single director.

2. News of the move came in a memo to staff in which the 81-year-old founder and majority owner of Bloomberg, the global financial data and media giant, also announced a new CEO and a new president at the firm. Vlad Kliatchko, Bloomberg’s chief product officer, and Jean-Paul Zammitt, the company’s chief commercial officer, were promoted to the top two jobs respectively. Neither man is replacing anyone, since the company didn’t have a sitting CEO or president. The founder, who holds no title but is reportedly very much in charge of his eponymous firm, also made his own position clear, writing: “I’m not going anywhere.”

3. Bloomberg’s new board of directors will be headed by Mark Carney, the former governor of the Bank of England, but no other incoming members were mentioned. In the memo, he thanked his directors for their decades of service, but mentioned it was “time to build on what they did and get the next generation into place.”

4. Spanish soccer official faces sexual abuse investigation as his mother goes on hunger strike

1. In a bizarre twist in the story that's been called Spanish soccer's "MeToo" moment, the mother of the man at the center of a scandal sparked by an unsolicited kiss locked herself in a church and went on hunger strike to protest his treatment Monday. The woman began her protest just hours before a top court said prosecutors had launched an investigation into her son for possible sexual assault. 

2. Ángeles Béjar, mother of Luis Rubiales, the disgraced ex-head of the Spanish soccer federation, told Spanish news agency EFE on Monday that she'd shut herself inside a church in the southern Spanish town of Motril and that she would not eat until what she called the "inhumane and bloody" persecution of her son ended.

5. Shell, Europe’s biggest oil company quietly shelves a radical plan to shrink its carbon footprint MM

1. It hasn't made public any new targets for developing offsets or specified how it now plans to deliver on its future climate commitments.

2. Six months after becoming the CEO at Shell, Wael Sawan quietly ended the world’s biggest corporate plan to develop carbon offsets, the environmental projects designed to counteract the warming effects of CO2 emissions.

3. In an all-day investor event in June, Sawan laid out an updated strategy for the European oil major that included cutting costs and doubling down on profit drivers like oil and gas. As important as what he omitted: any mention of the company’s prior commitment to spend up to $100 million a year to build a pipeline of carbon credits, part of the firm’s promise to zero out its emissions by 2050.

Goodliest of the Week (AB):

1. A renewable energy battery plant will rise in West Virginia where a steel mill once stood

1. The $760 million project will create 750 jobs on the site of what was once the beating heart of the steel economy in the Ohio River valley.

2. A cutting-edge energy storage company is building its main manufacturing plant where a once-thriving West Virginia steel mill once stood in the city of Weirton. According to lawmakers, the much-lauded project was made possible by incentives from 2022’s Inflation Reduction Act (IRA), signed by President Biden one year ago last week.

3. For supporters, it’s a sign that climate policies can also breathe life back into deindustrialized coal and steel communities with green jobs. The symbolism is compelling but how much those communities benefit will depend on a wide array of factors.

4. Form Energy, a Massachusetts-based company helmed by a former Tesla vice-president, broke ground on its iron-air battery manufacturing plant this past May. Workers will produce batteries capable of storing electricity for 100 hours, which will run on iron, water and air instead of the more common but less-abundant metal lithium. The $760 million project will create 750 well-paying permanent jobs, the company said.

2. Nissan is reusing the batteries from old Leaf electric vehicles to make portable power sources JS MM DR

1. Nissan’s new portable power stations give old Leaf batteries new life that can deliver emergency power during disasters

2. An associate professor of electrical and computer engineering who isn't involved in the Nissan project, said batteries can no longer be used to drive electric cars when their charge capacity declines to about 80%, but can still be used for other purposes

3. “Without such a solution, billions of EV battery packs will be made and then prematurely recycled in the next decade. That will be a problem for sustainability.”

3. Walgreens CEO Roz Brewer steps down after more than 2 years in the role

1. Congrats to Roz for realizing she had 10% influence at her own company thanks to Stefano Pessina, the ONE TRUE RULER with 63% influence that includes being married to one of the other execs.  

2. My advice, and write this down: DON’T BE THE CEO UNDER A DICTATOR LADIES

Assholiest of the Week (MM):

1. A renewable energy battery plant will rise in West Virginia where a steel mill once stood

1. The state where Senator Joe Manchin fought against his own climate proposal and used it as a ploy to get his shit in the Inflation Reduction Act now gets a renewable plant in his state?

2. West Virginia passed into law a bill banning ESG from state retirement, claiming, “Environmental, social, corporate governance, or other similarly oriented considerations are not pecuniary factors…” - GOVERNANCE?  They said corporate governance!  That means, technically, the West Virginia should justify every time they even vote to elect a director, as that is governance

3. THIS IS THE STATE BENEFITING FROM RENEWABLE JOBS???  PUT THOSE FUCKING JOBS IN NEW ENGLAND AND CALIFORNIA ONLY.

2. Tariq Fancy DR JS

1. Look, I’m sure you’re a nice guy, but I’m going to go out on a limb and say that less than two years of experience in a job called “sustainable” doesn’t qualify you to say shit like:

2. It's time to dismantle this circus': ESG has served its purpose, say BlackRock's Tariq Fancy and DWS's Desiree Fixler - Financial News

3. Former BlackRock exec Tariq Fancy: Many ESG experts are ‘underqualified’ - Financial News

4. Your prior experience was in private equity turnarounds and SIngapore-based social media marketing, what the fuck do you know about the LITERALLY THOUSANDS of data points I and my ESG brethren hand collected in pursuit of deep transparency around companies

5. ESG data and ratings aren’t great, but then again, what the fuck do you actually know?

3. Jeff Owen and Todd Vasos, Dollar General

1. This story isn’t the biggest deal of the week: Dollar General's messy stores are haunting the retailer as it takes a $95 million hit on inventory markdowns and deploys 'smart teams' to clean up

2. But it proves a point - your fucking management team actually might matter if they suck?

3. Dollar General managed to squeeze a whopping two women (25%) and two people of color (25%) on their board, with one twofer (black woman!)  Don’t worry, they have less influence than their body count… 19% influence, 37% representation

4. The median employee makes less than $17,000 a year.  The CEO made that in 4 hours.  The committee that approves pay disclosed “no interlocks”, but we peg the board as 30% interconnected inside two phone calls.

5. Todd Vasos, the Igered ex-CEO, is the largest individual shareholder outside of institutional investors, still sits on the board with his CFO who is now the CEO, Jeff Owens.

6. The two of them control 40% of the board influence together

4. Female Professors Sue Vassar College, Alleging Gender-Based Salary Discrimination

1. REALLY?  VASSAR???

Exhausting-est of the Week (JS):

1. Carbon offsets are still not as effective as cutting your carbon emissions

1. Large, high-emitting companies like Delta, JetBlue, Disney, General Motors and Shell have all bought and sold huge amounts of carbon offsets in the name of climate action.

2. A systematic evaluation of 26 carbon offset projects that claim to slow the rate of potential deforestation in six countries on three continents, found that the vast majority of projects did not actually slow deforestation, and those that did were significantly less effective than they claimed.

3. According to the study’s lead author, “The main message is that relying on carbon offset certification is not enough. He also said, “If you rely 100 percent on offsets, you probably will not do anything positive in terms of mitigating climate change.”

2. Fossil Fuel Subsidies Surged to Record $7 Trillion

1. Fossil-fuel subsidies rose by $2 trillion over the past two years, putting the total right around $7 trillion for the past year

2. I know that this was, in large part, a result of the war in Russia and making sure countries had access to necessary energy BUT we’re living through a climate CRISIS. What if some of this money went into expanding renewable energy?

3. Investors warn ‘fluffy’ ESG metrics are being gamed to boost bonuses MM DR

1. Three-quarters of S&P 500 companies have disclosed that environmental, social and governance metrics contributed to executives’ pay (up from two-thirds)

2. Asset managers are skeptical of ESG metrics being used in compensation, according to Ben Colton, head of stewardship at State Street Global Advisors. He said.. “Oftentimes they are very subjective, fluffy and easily gamed.”

3. Simple solution: USE OUR DATA!!! Soon, we’ll have data on NEOs and you can use it to fairly assess bonuses based on actual performance metrics backed by data

Who Won the Week?

1. DR: Me (I predicted Ari would be back to work after labor day (September 5), my office spies reported she worked on August 31st. I’ll call that a win somehow

1. DR: Ari quits maternity leave early… comes back after Labor day

2. MM: Ari quits maternity leave early… comes back by National Ice Cream Sandwich Day (August 2nd, a real day)

2. MM: Proxy voting!  This has to be the first time in history anyone cared outside of governance circles how Blackrock and Vanguard voted, right?

3. JS: Parents because kids went back to school!

Predictions

1. DR: copycat glasscliff firing at CVS: Karen Lynch; hitting .247 overall

2. MM: Before the end of 2023, someone launches a line of anti-anti-woke products on a new website that will go public via SPAC inside of 6 months