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The Activist Investor Done With Finance


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One of America’s top activist investors said that he’s leaving the $16 billion hedge fund, ValueAct, that he has turned into a major force in corporate boardrooms. His reason is, perhaps, even bigger news.

Mr. Ubben is a force in shareholder activism, who has made companies like Microsoft change strategy to improve returns for investors. But unlike others in the field, he largely avoids splashy public fights — winning praise from defenders of corporate boards like Marty Lipton.

He’s leaving to start a new hedge fund, Inclusive Capital Partners, with co-founders like the investor Lynn Forester de Rothschild, who’s focused on — you guessed it — “inclusive capitalism.” The new firm is focused on environmental and social impact investments. (Mr. Ubben will still manage ValueAct’s $1 billion impact fund as well … for now. More on that below.)

• Definitions can be squishy, but assets tied to socially responsible investment are generally estimated at around $12 trillion in the U.S., out of $30 trillion worldwide.

Mr. Ubben thinks traditional corporate finance is played out. He told Andrew that corporate America thinks too much about the short term, a trend he admitted he helped drive. Traditional activist investing to force a C.E.O. change, shareholder payout or sale of a company won’t accomplish much anymore.

• For good measure, he told The Financial Times: “Finance is, like, done. Everybody’s bought everybody else with low-cost debt. Everybody’s maximized their margin. They’ve bought all their shares back … There’s nothing there. Every industry has about three players. Elizabeth Warren is right.”

Mr. Ubben’s focus now is a different sort of activist investing, with an eye on big issues like the environment. Impact-focused activism, particularly at older corporate names, can drive bigger profits than traditional activism: “The legacy companies are valued like they’re going out of business and they have the work force, they have the geographies and intellectual property and all of that,” he told Andrew.

• The hedge fund mogul conceded that he’ll need to find “courageous C.E.O.s and boards,” and added, “I think we’re going to have to fire our shareholders. We’re going to have to find new shareholders, shareholders that want to be focused on the long term.”

• He also doesn’t think that investment firms — apparently like, um, ValueAct — can run both traditional funds and impact ones. “I don’t think these two strategies peacefully coexist,” he told the FT.

ImageAttorney General Bill Barr
Credit…Michael Reynolds/EPA, via Shutterstock

A hearing held by the House Judiciary Committee today is expected to examine whether the Justice Department has let politics seep into enforcement actions — including antitrust cases.

Expect a lot of questions about Roger Stone, the Trump adviser who was convicted last year of witness tampering and lying to the authorities in connection with Robert Mueller’s investigation. A former prosecutor, Aaron Zelinsky, plans to testify that he believes senior law enforcement officials intervened to seek a more lenient prison sentence.

But pay close attention to testimony from John Elias, a career official in the department’s antitrust division, who alleges that under Attorney General Bill Barr his group was asked to pursue cases for political reasons:

• The department purportedly investigated 10 takeovers in the marijuana industry because Mr. Barr “did not like the nature of their underlying business,” according to Mr. Elias’s opening statement. The department’s antitrust chief, Makan Delrahim, reportedly conceded as much to staff last September.

• Mr. Elias also accuses the department of acting on political motives in its review of California’s emissions deal with four big carmakers.

The hearing could raise questions about antitrust investigations in tech. A bipartisan group of state attorneys general have been investigating Silicon Valley titans like Google. But concerns that Justice Department leaders may have ulterior motives — such as beliefs that the companies have an anti-conservative bias — won’t help those cases.

President Trump’s order suspending several types of work visas brought swift corporate condemnation, but it’ll take a while to bite, immigration experts say.

“The immediate impact of the suspension is mostly symbolic,” a policy analyst told The Times’s Gillian Friedman. Consulates aren’t interviewing for most green cards or temporary work visas because of the pandemic. The effects will become clearer when they reopen.

More business leaders are speaking out, with tech executives the most prominent.

Apple’s Tim Cook: “Like Apple, this nation of immigrants has always found strength in our diversity, and hope in the enduring promise of the American Dream. There is no new prosperity without both. Deeply disappointed by this proclamation.”

Microsoft’s Brad Smith: “Now is not the time to cut our nation off from the world’s talent or create uncertainty and anxiety. Immigrants play a vital role at our company and support our country’s critical infrastructure. They are contributing to this country at a time when we need them most.”

Tesla’s Elon Musk: “Very much disagree with this action. In my experience, these skillsets are net job creators. Visa reform makes sense, but this is too broad.”

The suspension sparked outrage in India, where three-quarters of H-1B visa holders come from. Hemant Mohapatra, a partner at Lightspeed Ventures who returned to India in 2018 after more than a decade working on an H-1B visa for Google, Andreesen Horowitz and others, called the ban a “personal betrayal.” He pointed to a post he wrote shortly after his move to help others decide “when it is the right time to head home.”

A “disturbing surge” suggests that the virus isn’t under control. America’s top infectious disease expert, Dr. Anthony Fauci, told House lawmakers yesterday that the next few weeks would be crucial in dealing with a spike in cases in states like Arizona, Florida and Texas.

Representative Alexandria Ocasio-Cortez won her Democratic primary for the New York seat that she won in 2018. She defeated Michelle Caruso-Cabrera, a former CNBC anchor backed by top Wall Street executives. “Their money couldn’t buy a movement,” Ms. Ocasio-Cortez tweeted.

There’s tech, and there’s everything else. Records set by the Nasdaq highlight how the performance of big tech stocks has diverged sharply from the rest of the market. At this point, the tech-heavy Nasdaq’s advantage over the Dow and S&P 500 is the biggest since the early 1980s, according to The Wall Street Journal.

Some companies are giving executives big bonuses before filing for bankruptcy. The payments, often in cash instead of stock, often aren’t tied to performance and can be tricky for courts to claw back.

Baseball will return. Major League Baseball and its players’ union resolved their differences over a shortened 60-game season, and play will begin — with no fans in the stands — on July 23 or July 24.

Credit…Marco Di Lauro/Getty Images

Many companies say that their employees are much more efficient working from home, reports The Times’s David Gelles. But as lockdowns drag on, can that last? And if so, at what cost?

Processes that managers took for granted seem less essential now, from long meetings to regular status updates. And that — along with the disappearance of commutes and office-based distractions — means workers can get more done, a host of companies told David. (Home-based distractions are another matter, of course.)

But there is a downside. Managers are worried about the effects of isolation, decaying social capital and lack of camaraderie. Mental health is a particular concern, David tells us, and he dug into his notebook for some extra material about it, based on his reporting:

To combat the risk of burnout, many employers are offering virtual mental health offerings to remote workers.

“Everyone is so focused on the protection of the virus,” said Douglas Merritt, the C.E.O. of the software company Splunk. “But health includes mental health, emotional health, physical health, financial health.” Splunk is among the companies that have started offering daily meditation and mindfulness sessions to remote workers.

Early in the crisis, Salesforce also started a daily mental health call, and was encouraging employees to develop a daily meditation, mindfulness or prayer practice. “We’re in a much more stressful environment than ever before,” Salesforce’s C.E.O., Marc Benioff, said in late March. “We have to take care of that.”


• Dell is reportedly exploring options for its $50 billion holding in the software company VMware, including spinning off the stake to shareholders. (WSJ)

• Amazon will create a $2 billion fund to invest in clean-energy start-ups that could help it become net carbon zero by 2040. (TechCrunch)

• The mall operators Simon and Brookfield Property Partners are reportedly exploring a bid for J.C. Penney, to help out their shopping centers. (WSJ)

Politics and policy

• The Trump administration is considering tariffs on Canadian aluminum, risking a trade war before the new North American free-trade pact goes into effect. (NYT)

• The E.U. may block American travelers as a coronavirus risk. (NYT)


• Amazon employees are pressing the company to address what they say is systemic racial inequality. (NYT)

• Stacy Brown-Philpot of TaskRabbit, one of Silicon Valley’s few black C.E.O.s, is stepping down. (NYT)

• Palantir appointed Alexandra Wolfe Schiff to its board ahead of a planned I.P.O. The former Wall Street Journal reporter (and daughter of the author Tom Wolfe) is the first woman to serve as a director at the data-mining company. (Bloomberg)

Best of the rest

• Plexiglass supplies are running low, because of all those new virus-proofing barriers. (WSJ)

• “The City of London Has a Slavery Problem” (Bloomberg)

• WeWork’s private jet could now be yours for a mere $50 million. (Business Insider)

We’d love your feedback. Please email thoughts and suggestions to dealbook@nytimes.com.


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