Consumer: P&G board survives challenge
Activist investor Nelson Peltz’s rancorous bid for a board seat at Procter & Gamble fell narrowly short this week, said Sharon Terlep and David Benoit in The Wall Street Journal. P&G, whose brands include Tide, Oral-B, and Pampers, has endured a bruising and expensive corporate proxy battle with Peltz, who owns $3.5 billion in stock in the consumer-goods giant and has demanded that the company make massive strategic changes “after a decade of market-share losses and stagnating profits.” P&G said preliminary votes showed all 11 current directors were re-elected, but Peltz disputed the result, saying he would wait until an independent auditor confirmed the vote.
“If P&G’s victory is confirmed, it shouldn’t spend too much time fist pumping,” said Sarah Halzack and Brooke Sutherland in Bloomberg.com. Although Peltz appears to have been unsuccessful in gaining a board seat, he gained genuine momentum with his call for a turnaround effort. While the current board insisted progress has been made under CEO David Taylor, Peltz “painted a vastly different portrait of a company not innovating fast enough.” He bemoaned a lack of digital savvy and questioned why the company isn’t doing a better job maintaining and growing market share. Each time the company reports earnings, “this will dwell in the minds of shareholders.”
Economy: Job market stumbles
Reeling from the effects of hurricanes in Texas and Florida, the U.S. economy shed 33,000 jobs in September, ending a historic 83-month stretch of job growth, said Patricia Cohen in The New York Times. Economists largely “discounted the discouraging report, describing it as a blip in a job market that was fundamentally strong.” The jobless rate fell slightly, to 4.2 percent, the lowest since February 2001. Wages showed an impressive year-over-year gain of 2.9 percent, but that growth was probably “exaggerated, because many low-wage workers were temporarily displaced by the storms” and not counted.
Wall Street: Fearless Girl firm underpaid women
The firm behind Wall Street’s Fearless Girl statue has agreed to pay $5 million to more than 300 female and black employees “who were paid less than their white, male counterparts,” said Patrick Coffee in Adweek. Boston-based State Street Corp., the parent company of the investment firm that installed the popular statue of the little girl who “faces down Wall Street’s famed Charging Bull statue,” was accused by the Labor Department of discriminating against hundreds of female and minority executives since at least 2010. State Street, which manages $2.6 trillion in assets, officially denies the allegations.
Trade: NAFTA negotiations at risk
The fourth round of NAFTA talks began this week “amid increasing acrimony,” said David Lawder and David Ljunggren in Reuters.com. Mexican and Canadian negotiators were taken aback by contentious new demands from U.S. officials, as President Trump made “fresh threats to terminate the 23-year-old agreement.” Negotiators have reportedly stumbled over U.S. demands to sharply increase North American parts requirements for automobiles; the U.S. has also called for “radical changes to NAFTA’s dispute arbitration systems and changes to intellectual property provisions.”
Tech: Executive shake-up at GE
General Electric CEO John Flannery “is moving quickly to make his mark on the company,” said Ed Crooks and Mamta Badkar in the Financial Times. Flannery, who took over in August from longtime chief executive Jeff Immelt, last week replaced three top executives and signaled “a focus on cost reduction.” Chief financial officer Jeff Bornstein, head of business innovation Beth Comstock, and head of global growth John Rice will all leave before the end of the year; Bornstein and Comstock “had been seen as potential successors” to Immelt.