Chevron says zinc levels in U.S. Mars oil output within limits
The start-up of an offshore well caused zinc contamination in Mars crude, Chevron had said earlier this month, leading to tightening crude oil supply in the key Gulf Coast refining hub and the government releasing barrels from its emergency stockpile.
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Reuters
9 minutes ago
- Reuters
The most precarious job in America's boardrooms: CEO
NEW YORK, July 29 (Reuters) - U.S. companies are removing their CEOs at the fastest clip in two decades, data shows, as increased scrutiny from shareholders and boards result in reduced tolerance for sub-par returns or wayward conduct. At least 41 CEOs have exited S&P 500 companies so far this year, compared with 49 for all of 2024 – making the fastest pace on an annualized basis since 2005, according to data from nonprofit executive research group The Conference Board and data analytics company ESGAUGE. In the latest example, consumer goods company Procter & Gamble (PG.N), opens new tab, the maker of Tide laundry detergent and Bounty paper towels, said on Monday CEO Jon Moeller will be replaced next year by longtime executive Shailesh Jejurikar. Moeller, who has been CEO since 2021, will become executive chairman, a powerful role on the board that allows the former chief to retain a strong voice in company affairs. Before that in the last three weeks alone Tylenol-maker Kenvue (KVUE.N), opens new tab replaced its CEO and health care products distributor Henry Schein (HSIC.O), opens new tab said its CEO will leave at year's end. In interviews, more than a dozen executive recruiters, investors, bankers, lawyers and industry advisers attributed the high turnover this year to a range of reasons, some building up from economic and social changes since the Covid-19 pandemic. While high inflation, geopolitical instability and the Trump administration's trade war has complicated the job of CEOs, diversity gains made boards more independent and demanding of the person in the top job, these people said. At the same time, in a stock market setting new records but driven mostly by large tech names, underperformance had given activist investors, who push for corporate changes from selling a division to buying back more stock, greater sway, leading to management changes. "Trying to fire the CEO has become a referendum on what's perceived to be a failed company strategy," said Peter da Silva Vint, managing partner at consulting firm Jasper Street, which works with companies facing pressure from activist investors. "And investors have become more comfortable with it as a mechanism to send a message." CEOs at companies that are lagging their peers are most at risk for demands from activists, with almost half – 42% – of S&P 500 companies that changed leaders last year foundering in the bottom 25th percentile for total shareholder returns, according to a November study, opens new tab led by The Conference Board. Take the case of Kenvue, where the board said it was replacing CEO Thibaut Mongon "to unlock shareholder value and reach its full potential" after the stock had lost 16.5% since its spin out from Johnson & Johnson (JNJ.N), opens new tab two years ago. In contrast the S&P 500 has climbed 41% since August 2023, when Kenvue became a fully independent company. Kenvue took action after three U.S. hedge funds -- Starboard Value, Tom's Capital and Third Point – agitated for change at the company, and Starboard CEO Jeffrey Smith got a board seat in March to settle that hedge fund's proxy fight. The battle at Kenvue continues, however. The other two funds continue to agitate for more changes, including divesting assets and possibly selling the entire company, according to people familiar with the matter. With a new CEO on board investors, are confident a sale is sure to follow, the sources said. Kenvue declined to comment, Mongon could not be reached for comment and the hedge funds did not respond to requests for comment. "Activist investors are feeling more empowered, and if they have bought into a company's five-year plan then they want someone to exercise it," said Georgetown University professor Jason Schloetzer, an expert in corporate governance. "And if the guy at the top can't do it, they'll find the next one." Beyond shareholder activism and performance, changes in the makeup of boards over the past decade when there had been a new focus on adding diversity was also playing a role in the shakeup at the top, corporate governance experts said. Such boards were acting with greater independence, putting CEOs on tighter leash, these people said. "Newer members have more objectivity relative to prior generations," said Jason Baumgarten, head of global board and CEO practice at executive recruitment firm Spencer Stuart. Another factor in the high CEO turnover: less tolerance of unethical behavior, especially after the #MeToo movement. Questions over personal conduct led to the departure of at least two of the 40 CEOs at S&P 500 -- at Kroger (KR.N), opens new tab and Kohl's (KSS.N), opens new tab. Representatives for the companies did not respond to requests for comment and the former executives could not be reached for comment. But the trend goes beyond publicly traded companies as well. Earlier this month, Andy Byron, the married CEO at privately held technology company Astronomer, left his position after a video of him embracing the firm's human resources chief Kristin Cabot, who is not his wife, at a Coldplay concert went viral. Astronomer did not respond to a request for comment and Byron could not be reached. Reputational risk and corporate culture have become central to a company's long-term value, Jasper Street's da Silva Vint said. "Today's boards are far more willing to act decisively, removing executives, not only to enforce policy, but to protect shareholder, employee and public trust," he said.
Reuters
9 minutes ago
- Reuters
US, China finish talks in Stockholm as tariff truce holds for now
STOCKHOLM, July 29 (Reuters) - U.S. and Chinese officials finished two days of talks in Stockholm on Tuesday that were aimed at tackling longstanding economic disputes and stepping back from an escalating trade war between the world's two biggest economies. While announcing no breakthroughs, China's top trade negotiator Li Chenggang said the two sides agreed to push for an extension of a 90-day tariff truce struck in mid-May, without specifying when and for how long such an extension could come into force. The talks could pave the way for a meeting between U.S. President Donald Trump and Chinese President Xi Jinping later in the year, though Trump denied going out of his way to seek one and Chinese officials did not mention it. After months of threatening high tariffs on trading partners, Trump has secured trade deals with the European Union, Japan, and others, but China's powerhouse economy and grip on global rare earth flows make these talks particularly complex. Both sides in May walked back from imposing triple-digit tariffs on each other in what would have amounted to a bilateral trade embargo. But global supply chains and financial markets could face renewed turmoil without an agreement. Underlining the stakes, the International Monetary Fund on Tuesday raised its global growth forecast but flagged a potential rebound in tariff rates as a major risk.
Reuters
9 minutes ago
- Reuters
L'Oreal posts 2.4% rise in second-quarter sales
PARIS, July 29 (Reuters) - L'Oreal < opens new tab reported a 2.4% rise in second-quarter sales on Tuesday, missing forecasts as growth in Europe slowed more than expected and demand at travel outlets in Asia was subdued. The French cosmetics group, whose brands include Maybelline makeup and CeraVe skincare, said sales in April-June totalled 10.74 billion euros ($12.38 billion), up 2.4% on a like-for-like basis from a year earlier, but undershooting the 2.9% growth seen in a Visible Alpha consensus estimate cited by Jefferies. Underlying growth, after stripping out the impact of phasing in a new IT system, was 3.7%, the company said. Growth in the global cosmetics market has slowed sharply in recent quarters from the highs of a post-pandemic surge, when inflation contributed to rising sales values. The sector, and in particular perfume that is predominantly produced in Europe, is also facing higher costs from U.S. President Donald Trump's tariffs. L'Oreal CEO Nicolas Hieronimus said he planned to continue to lobby for an exemption to U.S. tariffs on European cosmetics, even after Brussels agreed to a deal on Sunday that imposes a 15% tariff on U.S. imports of EU cosmetics. "I don't think it's a good deal," he told Reuters in an interview. "We're going to be writing to all the European leaders and negotiators to see whether there's a loophole we could benefit from, because in the end it's going to be costly," he said. L'Oreal, which imports around 30% of its U.S. sales, could raise prices and move more production to the country where it has four factories, but is waiting for further negotiations between Trump and other nations to be finalised before making decisions, he added. Analysts at Jefferies expect perfume sales in the U.S. to slow in the second half after companies hike prices, though Hieronimus said L'Oreal's fragrance sales were currently growing by double-digit figures, compared to 7% for the broader market. There is "some pricing power on fragrances, but we have to also consider the elasticity of the demand," he added. ($1 = 0.8674 euros)
