Hello and welcome to our weekly intelligence briefing for boards, where we help directors keep up to speed on the macro trends affecting businesses across the world, and corporate governance news.

We hope you enjoy it and, as always, you can email your suggestions for stories and resources to [email protected].

You can also find more news and resources on our online hub FT.com/Board.
Each day FT Leader writers on the Editorial Board meet to discuss the topics to be considered for Leader columns. Here are the issues that dominated this week:

Latin America's fondness for stashing wealth offshore meant the revelations of the Pandora Papers were particularly damaging to the elite of the region – and an indictment of the attractiveness of investing in their own economies

The UK's decision to raise the minimum wage is a decent response to cost of living pressures, but this justified measure highlights other unjustified pressures on employers.

And later in the week we'll look at the range of iniquitous actions and inaction alleged against Facebook: among the most egregious is its failure to intervene in non-English speaking regions to prevent the dissemination of misinformation and incitements to abuse human rights.

The inflation spook continued this week as the global drop in government bond prices shifted to short-term debt. Investors worry that a rise in interest rates could dent the economic recovery.

Elsewhere, COP26 and the UK’s Budget dominated proceedings.

Ahead of the climate conference, the UN warned that global climate pledges are off track and could lead to an increase in greenhouse gas emissions of nearly a fifth by 2030 without further action.

Yet despite these stark figures, US president Joe Biden still faces a fight to salvage his climate agenda. Some of the most aggressive steps in the spending package are likely to be stripped out due to opposition from lawmakers, including in his own party.

There may be less compromise ahead for companies, however, as today the Science Based Targets initiative, the de facto arbiter of corporate climate targets, laid down new rules to combat the “wild west” of green business pledges.

Away from COP26 and it was chancellor Rishi Sunak’s week as he unveiled his tax, save and spend” Budget. Improved economic forecasts and previous tax rises gave him extra revenue, which he split between improving public finances and spending more on public services.

Indeed, the chancellor claimed to be on a “moral” mission to cut taxes and limit the growth of the state. There is just one problem: taxes are heading for their highest level since 1950.

“But, stripped of its grandiose rhetoric, Rishi Sunak’s effort was not so much agenda-setting as a recognition of political realities,” writes chief economics commentator Martin Wolf. The government has made its peace with the pressures for a big state, predominantly to protect the elderly, he notes.

Despite all the announcements, UK businesses still face tough headwinds. Industry chiefs warn that recovery pains will not be shortlived, with supply chain problems, labour shortages and rising prices hitting the economy.

Onto corporate governance and EY’s flawed audit of Wirecard makes for an interesting read. First-hand testimony shows the missed opportunities to uncover the fraud and how the firm failed to understand a company it had audited for a decade.

Royal Dutch Shell is also under pressure from activist hedge fund Third Point. It has accused the oil supermajor of having “an incoherent, conflicting set of strategies” and urged it to split itself into “multiple standalone companies”.

And finally, THG is still making headlines. On Tuesday, the company’s shares dropped 21 per cent despite moves to reassure investors.

The company said it would find  an independent chair and disclosed some financials. But the numbers “were not altogether encouraging,” writes UK business writer Cat Rutter Pooley, adding that “the governance questions are far outweighed by the financial ones.”


Facebook is mired in scandal after whistleblower Frances Haugen accused the company of placing “profit over safety” and leaked thousands of internal documents.

Amidst the revelations, there is an interesting aspect to the story for directors: Mark Zuckerberg is chief executive, president and controlling shareholder with about 58 per cent of the voting shares.

With big tech firmly on the agenda, the International Corporate Governance Network has an interesting article on governance, which includes how investors can improve accountability.

The Chartered Institute of Internal Auditors also has a useful briefing for boards about whistleblowers.

Don’t forget, there are plenty more resources on our online hub FT.com/Board.
Annual review of corporate reporting: 2020/21 (Report by Financial Reporting Council) (Analysis by the FT)

Last week we hosted a virtual event Net positive: how courageous companies thrive by giving more than they take where Paul Polman, former CEO of Unilever and co-founder and chair of IMAGINE, discussed the challenges boards face in dealing with ESG and how business leaders can harness their power to deliver meaningful change in the world.

If you missed it, you can watch the replay here.

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