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The Morning Risk Report: Public Firms Score Early Win Over Proxy Advisers |
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SEC Chairman Jay Clayton said public statements from SEC staff are ‘nonbinding and create no enforceable legal rights or obligations.’ PHOTO: BRENDAN MCDERMID/REUTERS
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Good morning. U.S. public companies scored an early victory in a longstanding fight to curb the impact of consultants who influence shareholder votes on issues such as executive pay, The Wall Street Journal reports.
Rescinded guidance: The Securities and Exchange Commission on Thursday rescinded a pair of letters written by staff that had given mutual-fund managers greater assurance to rely on a consultant's recommendations about matters up for a vote at a public company's annual meeting.
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Companies and Republican lawmakers say the letters had boosted the influence of consultants known as proxy advisers that sometimes oppose big CEO pay packages. The U.S. Chamber of Commerce had pushed to quash the letters and more tightly regulate two top proxy advisers who they say form a duopoly that has sweeping influence over governance matters.
Trend: The SEC's decision reflects a trend by Trump administration financial regulators to overturn less-formal policies adopted under previous administrations. Banking regulators have issued what they call "guidance" to urge firms to curb activities they see as risky. Although such guidance doesn't have the full force of law, regulators sometimes treat it that way.
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| From Risk & Compliance Journal |
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Sanctions Order on Election Meddling Has Little Bite, Experts Say |
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The sanctions aren't country-specific because threats to the U.S.elections process come from a variety of sources, said U.S. National Security Advisor John Bolton. PHOTO: FABRICE COFFRINI/AFP/GETTY IMAGES
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President Trump’s executive order authorizing sanctions against foreigners who attempt to interfere in U.S. elections won’t deter meddlers and is somewhat redundant, according to sanctions lawyers, U.S. senators and others.
The order, signed Wednesday, allows the U.S. to impose sanctions on countries, individuals and companies that support efforts to meddle in the U.S. political system through hacking or digital propaganda.
Lawyers focused on sanctions law, former U.S. officials and two U.S. senators said the language of the order is designed to grab headlines without addressing the issue, as existing sanctions authorities targeting cybercriminals already punish such conduct.
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How Retirement Adviser Redington Bridges The Gender Pay Gap |
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Redington Ltd. chief Mitesh Sheth spoke to Risk & Compliance Journal's Mara Lemos Stein about how the firm’s policy of hiring mid- to senior-level women returning to work after career breaks played a part in closing its gender pay differential and reaching pay parity this year.
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U.S. Puts Sanctions on Tech Firms, Alleging They Are North Korean |
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The U.S. Treasury Department put sanctions on two companies, based in Russia and China, respectively, that Washington said were fronts for the North Korean government, generating revenue for Pyongyang's weapons programs.
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Deutsche Bank Names New Global Head of Anti-Financial Crime
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Deutsche Bank AG promoted a London-based senior risk officer to oversee global financial crime-fighting responsibilities. Stephan Wilken, who has been with the bank more than 20 years, will take the role on Oct. 1, the bank said.
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Labor Board to Ease Company Liability for Contractor
Conduct |
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The National Labor Relations Board took its first steps toward reversing an Obama-era rule that had made it easier to hold companies liable for conduct by their contractors and franchisees. The board proposed restoring an earlier standard, a victory for business groups.
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Men Get Nearly Every Word During Earnings Calls |
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A study of more than 155,000 company conference calls over the past 19 years done for Bloomberg News found that men spoke 92% of the time. It's not just because men outnumber women in executive roles -- they also talk more.
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Facebook to Start Fact-Checking Photos, Videos |
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Facebook Inc. said it will use technology and human reviewers to fact-check photographs and videos on its platform try to stanch what it called "misinformation in these new visual formats."
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GM Recalls One Million Pickups and SUVs in U.S. for Crash
Risk |
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General Motors Co. is recalling more than one million vehicles over a steering defect. The defect, which causes drivers to lose control especially at lower speeds, has been linked to 30 crashes and two injuries.
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Goldman Sachs’ Next CEO Replaces Finance Chief, Names Deputy |
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David Solomon is installing investment bankers in the firm's senior-most roles as he prepares take the helm of Goldman Sachs Group Inc., capping a power shift away from the trading business that has struggled to make money.
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Airbus Names Sales Chief Amid Shake-Up in Senior Ranks |
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European plane maker Airbus SE named a new top salesman, a surprise move that widens a senior leadership shake-up at the company. Christian Scherer will take over immediately as chief commercial officer, Airbus said.
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Across the U.S., 5G Runs Into Local Resistance |
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As all four national cellphone companies push to build out their networks on small, local cells and lay the groundwork for fifth-generation service, they face pushback, and not just from residents.
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UPS Lays Out Plans for More-Profitable Shipping |
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United Parcel Service Inc. executives laid out plans to cater to more-profitable customers, such as small and mid-size businesses and health companies, to improve its bottom line.
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Raw cobalt rolls along at a plant in Lubumbashi, in the Democratic Republic of the Congo. The country is the dominant producer of the metal, used in products such as iPhones. PHOTO: SAMIR TOUNSI/AGENCE FRANCE-PRESSE/GETTY IMAGES
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Despite Vows, Some Suppliers Keep Miners Digging by Hand in
Congo |
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Apple Inc., Volkswagen AG and about 20 other global manufacturers found themselves on the defense when Amnesty International reported two years ago that the cobalt in some of their batteries was dug up by Congolese miners and children under inhumane conditions. Many of the companies said they would audit their suppliers and send teams to Congo to fix the problem.
Their efforts haven’t kept hand-dug cobalt out of the industry supply chain.
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WageWorks Shares Fall After Firm Launches Probe |
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WageWorks Inc. shares fell nearly 17% after the firm said it set up a special committee to investigate, among other things, allegations that information was withheld from auditors.
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Readers can subscribe to The Morning Risk Report here: http://on.wsj.com/MorningRiskReportSignup. Follow us on Twitter at @WSJRisk.
Follow the WSJ Risk & Compliance Team on Twitter: @WSJRisk, @srubenfeld and @LikelyMara.
Send comments to the Risk & Compliance editor, Jack Hagel, at jack.hagel@wsj.com.
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