Elon Musk likes to attack power groups. It was as if he was on a mission.
Nothing seems to motivate him more than a slap on a revered organization or symbol. He seems committed to challenging all forms of power.
In the past few weeks, Techno King, known at Tesla (TSLA) – Get a free reportyes mock at Anthony Fauci, immunologist, face of America’s response to the Covid-19 pandemic.
This comes despite the risk that such an attack could backfire on Musk, and more specifically on some of his companies, like Tesla. The electric vehicle leader’s customer base is primarily comprised of progressives, who are often fervent defenders of Fauci.
But none of that stopped Musk, who said he wanted Dr. Fauci to be prosecuted.
Through his Twitter microblogging platform, he even promises the covid files will denounce what he sees as the totalitarianism of health authorities as they respond to the pandemic. These covid files are also said to have exposed Dr. Fauci.
musk afterwards attack The World Economic Forum, the last of its kind, has just ended in Davos, Switzerland. The billionaire accused the forum of acting like an unpopular world government. He thus gave the discourse of anti-elite and anti-globalists of all political backgrounds.
“The WEF is increasingly becoming an unelected world government that the people never asked for and did not want,” the tech mogul announced on January 18.
ISS, Glass Lewis has ‘too much power’: Musk
His accusations against Davos have sparked criticism for bringing together global economic and political elites as well as civil society figures.
If Musk, the second-richest man in the world, strongly criticizes a group of the rich like him, the forum’s critics say, his remarks demonstrate that Davos is not fulfilling his mission. the destiny it sets for itself.
The World Economic Forum meeting in Davos has largely become irrelevant, nothing more than a self-congratulation exercise for the world’s elites to convince themselves they are making a difference. particular,” the Patriotic Millionaires Association, an association of wealthy individuals fighting for “equal political representation, a living minimum wage, and a fair tax system.”
If the billionaire doesn’t expect his goals to instantly fall off the ledge under his blow, he hopes to at least weaken them forever.
But while his attacks on Davos are still hot, the global CEO is targeting two other entities that also symbolize power.
These are the two largest authorized consulting firms: Institutional Shareholder Services and Glass-Lewis. For Musk, the ISS and Glass Lewis are the true masters of the stock market. In his eyes, their strength was disproportionate.
The two companies provide advice to shareholders on executive compensation and voting for board members. Their advice is both considered and ignored.
“Too much power is concentrated in the hands of ‘shareholder services’ companies like ISS and Glass Lewis, because much of the market is index/passive funds, which outsource shareholder voting decisions. ,” Musk criticized on January 24.
The result is “The ISS and Glass Lewis effectively control the stock market.”
As usual with Musk, the first attack is intended to set the stage and measure the surrounding temperature. In the coming days or weeks, he will likely intensify his attacks on two companies, which promote the implementation of ESG (environmental, social and corporate governance) standards. Musk has considered ESG his number 1 enemy.
The ISS and Glass and Lewis did not respond to separate requests for comment.
‘What does the ISS think about that?’
On the other hand, Musk’s accusations against them were welcomed by Twitter users.
“These ‘administration solutions’ companies are very disturbing,” one Twitter user commented. “The words ‘recommended to vote against/yes’ are a thinly disguised threat that they are in control and you better go with them. I will never delegate my vote. for them 97% market share voting advice = complete control.”
“Um!” mock another user.
One Twitter user said: “It’s important to vote as an individual investor instead of letting these ‘shareholder services’ companies manipulate the stock market.”
There is a conflict between Musk and the two companies. For example, the ISS and Glass Lewis recommended shareholders vote against Tesla’s generous compensation package for its charismatic CEO in 2018. A Musk salary trial was held in October. 11 years ago.
According to Jim Woodrum, clinical professor of executive education at Northwestern University’s Kellogg School of Management, silent criticisms of the ISS and Glass Lewis could be heard in the boardroom.
“If you were to ask experienced directors their biggest complaint about boardroom changes in the last 20 years, I think many would grumble and then say something about Group Shareholder Services. and Glass Lewis,” Woodrum speak.
“For some, these entities have taken away the joy of being a director, as creativity has been replaced by an increasing focus on compliance.”
Woodrum then explains how the two consulting firms work and how they achieved power.
“Both companies have created models where they think good governance looks like. And both use different algorithms to determine if a certain company deserves a vote’ yes’ for Say on Pay and whether individual board members should be supported,” he continued.
“Many organizations follow their recommendations, while others sign up for the service but also use their own staff to determine how they should vote for their stock.
“The most interesting thing about these companies is that their business model requires them to change their principles on a regular basis. After all, if they have a simple set of rules and all If companies were to adopt them, there would be no need for the ISS or Glass Lewis to exist.”
But boardrooms have become dependent on the ISS and Glass Lewis, Woodrum warns.
The most common boardroom conversation, he says, is, “‘What does the ISS think about that?’
“This has also led to homogenization of boardroom operations, as more and more companies comply with the latest ordinance from the ISS and/or Glass Lewis,” the professor said.
The professor believes there is a way for the board of directors and the two consulting firms to coexist.
