Slack Technologies, Inc.
New York Stock Exchange June 19
Unlike most tech companies, Slack eschewed an initial public offering for a direct listing when it started trading last June. It’s not exactly unheard of – Spotify did a direct listing in 2018 – but nonetheless notable for a company to go public without bothering to raise a big chunk of capital. Whereas Spotify was reportedly working around some debt issues, it appears Slack simply cut out the middleman (and associated requirements and safeguards) because it didn’t need the extra capital, or the dilution that comes with it.
However, despite taking a different path to market than industry peers, the IM-for-the-office company has presented investors with a familiar set of governance concerns. Amongst other issues, there’s a dual-class voting structure that doesn’t afford shareholders any ability to call a special meeting or act by written consent; a classified board, with voting on a plurality basis and director removal from office only “for cause”; and supermajority approval is required for any changes to the governing documents. Getting two-thirds support will be tricky, given that co-founder, chair and CEO Stewart Butterfield controls 70.1% of total voting power thanks to that dual-class share structure.
As such, it’s somewhat moot that shareholders won’t get to weigh in on the bylaws, or executive compensation, or much at all, really, at the company’s upcoming annual meeting: since the board is classified, only three directors are standing for election, and the only other proposal on the agenda would ratify KPMG as auditors. That said, there’s more to an AGM besides just the voting – even if those outcomes are preordained, it will be interesting to see if a company known for facilitating remote collaboration will provide a virtual meeting platform that’s as engaging as its actual product.
Euronext Paris June 19
After nearly two decades with the same person in the driver’s seat, Renault is having trouble getting its steering wheel under control. When Carlos Ghosn stepped down in January 2019 following his arrest (but before his subsequent rearrest) for financial misconduct, the company used the unexpected transition as an opportunity to separate the positions of chair and CEO.
Tensions between the chair, Jean-Dominique Senard, and CEO Thierry Bolloré appear to have run high, and by October Renault’s board had decided unanimously (with three abstentions) to remove Bolloré. Reportedly it just wasn’t a good fit: his management style was described as brutal, prompting the departure of many senior managers and reliance on external consultants, and his relationship with Nissan’s senior management was seen as adversarial. Bolloré’s appointment may not have worked out, but it appears that the separation of chair and CEO roles provided the company and its shareholders with an important level of management oversight.
Unlike Mr. Bolloré, who had been appointed as deputy CEO by his predecessor, the company’s new CEO was recruited externally. Luca de Meo recently stepped down as the president of SEAT, a Spanish division of Volkswagen, and previously worked at Toyota, giving him some experience with Japanese car industry culture. Of course recruitment does come at a cost, and the board may face questions about the decision to set Mr. de Meo’s fixed pay 44% above that of Mr. Bolloré.
In light of the dynamic nature of the ongoing crisis, we have compiled additional resources to help navigate the proxy season, including: