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.

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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:

This week the FT sharpened the focus of its leader output, looking at one key story per day. We returned to the topic of Britain's non-dom tax regime, which attracted close attention several weeks ago when it emerged that the Indian-born wife of chancellor Rishi Sunak was a user of the scheme, saving her millions of pounds of tax: perfectly legally but not a good look.

Our conclusion was that a scheme to attract wealthy foreign talent to the UK is an important competitive advantage, but that the current rules are lax and often abused. “Non-dom status should be replaced by a form of temporary resident tax status, defined by statute, for those coming for limited periods.”

Later in the week we will opine on the Russian gas situation, after Poland and Bulgaria broke ranks with the EU’s realpolitik mechanism of facilitating rouble payments for gas supplies, prompting Moscow to cut off the flow of gas to Warsaw and Sofia.

We will also return to Elon Musk’s acquisition of Twitter and take a view on calls for tougher regulation of free speech in the name of public decency.
How did Elon Musk go from punchline to deal in under two weeks? The Tesla chief looks set to pull off a Twitter acquisition that earlier this month looked highly unlikely.

The world’s richest man has convinced Wall Street sceptics to back his offer to buy the social media platform, whose board has agreed to sell him the company for roughly $44bn. It is a deal that could result in Musk, who has more than 85mn Twitter followers, seizing control of the influential site and becoming a modern-day media baron. He has in the past used Twitter to attack regulators and critics.

Twitter’s board had attempted to hamper Musk’s ambitions with a poison pill to limit his liability. But it was forced to negotiate at the weekend after he unveiled a $46.5bn financing package. Directors even received calls from large and small investors pushing them to accept the offer.

As I wrote in my column this week, shareholder activism is on the rise - and has a new protagonist in Musk. There are political ramifications, too. Musk has no particular affiliation, but in the US, Democrats are nervous while Republicans are rejoicing at the prospect of a return to Twitter for Donald Trump, whose account was excluded in the wake of the January 6 2021 attack on the US Capitol.

In his pitch, Musk said he wants to make Twitter “better than ever” by introducing new features, making its algorithms open source, stamping out bots and authenticating “all humans”.

What next? The deal could still fall apart if blocked by regulators, or if Musk fails to deliver on the equity component of the transaction. It is worth noting that the terms allow Musk to back out by paying a $1bn " break fee" - a significantly lower backout fee than typical leveraged buyout.

Neither has Musk said how he will finance the deal. One option is to sell billions of dollars worth of his Tesla shares - a move anticipated on Tuesday when the carmaker’s shares slid more than 12 per cent. Volatile moves in Tesla’s stock underline the risks for Wall Street.

Meanwhile, the US dollar hit its highest level in more than two years this week, as the Fed was expected to tame inflation with an aggressive interest-rate rise. The dollar index, which tracks the US currency against six others including the euro and sterling, has risen by roughly 12 per cent in the past year.

Wider inflationary pressures are at play here: Russia’s invasion of Ukraine has lifted commodity prices, and rising coronavirus cases in China have prompted lockdowns that threaten to disrupt global supply chains further.

Gazprom, Russia’s majority state-owned energy group, suspended gas supplies to Poland and Bulgaria this week after it claimed it had not received payment in roubles. The interruption in supply rippled into markets, with the euro falling to a five-year low against the dollar. Our analysis sets out Russia’s rationale. Other EU energy groups are preparing to meet Putin’s payment terms.

In companies news, next month will see Amazon shareholders vote on a proposal asking the group to produce a tax transparency report to include a country-by-country reporting of taxes paid. The vote could be a litmus test for those businesses who profess to be champions of ESG, argues the FT’s Helen Thomas.

Tax is a major component of social impact. The OECD estimates that avoidance costs governments between 4 and 10 per cent of global corporate tax revenues - money that could be spent on health, education or infrastructure for the energy transition.

Others are taking pre-emptive action. Schroders - one of the UK’s largest asset managers, which manages £731.6bn - is trying to burnish its governance credentials by overhauling its “anachronistic” ownership structure to improve ESG, in a move that will give all shareholders voting rights. Schroders, whose founding family is still its largest shareholder, is aiming for the plan to be in place by late July.

Asset managers generally are finding their own governance under scrutiny as they make a concerted push into ESG investing. In 2016, the group drew criticism for flouting best corporate governance guidelines by making its then-CEO Michael Dobson its chair. Dobson will step down at the company’s annual meeting this week.

And in the US, investors in Abbott Laboratories, a medical device company, will this week vote on a first-of-its-kind shareholder proposal, which asks the company to disclose more information about transactions conducted using pre-arranged trading schedules.

These allow executives to divest shares according to a preset schedule filed with the US Securities and Exchange Commission without breaking insider trading rules. But the SEC and some investors are worried that they are open to misuse.

Meanwhile, accounting group RSM has this week bought out most of the shares in the business held by its former UK partners, consolidating the power of its new management team two years after the entire board was ousted following an investor coup. The move allows management to strengthen its grip and gives retired shareholders an exit route.

And finally, can you reach net zero by 2025? See if you can save the planet from the worst effects of climate change with the FT’s new interactive game.

ISSB sustainability proposals will mean more reporting for boards

This article is brought to you by FT Specialist’s Agenda, a publication that focuses on corporate boards.
For a view from the other side, the FT’s investment columnist Merryn Somerset Webb will be hosting an evening on how to make capitalism work for the individual investor. That takes place at the FT headquarters in London on May 5. Find out more here.

How are financial services companies using data to achieve net-zero targets? Join senior industry leaders from Deloitte, NatWest and others for this online event, as they explore how to turn ambitions into reality. The event is on May 12 - learn more  here.

Retired four-star General Stan McChrystal has lived a life associated with the deadly risks of combat; he has seen how individuals and organisations fail to mitigate risk. At our next online event, How to master risk, McChrystal joins Andrew Hill, the FT’s senior business writer, to discuss how to build and strengthen your organisation's risk management and what it takes to master risk to your and your business’s advantage. Join the conversation on Wednesday 18 May at 16.00 BST. Register today.
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