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PayPal Pilots Quarterly Call on More Than Financial Results

Nov. 13, 2019, 11:30 AM

Companies are experimenting with a different kind of quarterly call that goes beyond financial results to cover corporate responsibility.

Paypal CEO Dan Schulman is holding a first-of-its-kind Q&A with investors Nov. 13, one of a series of nontraditional quarterly calls planned by the call’s organizer, nonprofit advocacy group Just Capital.

Cloud-computing company Akamai Technologies Inc. plans to hold a similar quarterly call in December that’s also organized by Just, which ranks Russell 1000 index companies on social and environmental issues. Just says it has another company planned for January.

Quarterly earnings calls let company executives report on financial results and field questions from Wall Street analysts. Just’s version covers corporate performance on metrics for how they treat workers, customers, the environment, and their local communities.

A group of 181 top CEOs recently endorsed a business model centered on a company’s workers and other stakeholders, as an update to the investor-first mindset that has dominated for decades. The quarterly calls could help companies show how they’re carrying out that vision.

“The idea behind the Quarterly Just Call is that it provides a venue for CEOs to interact with their investors and the business finance world more broadly about their performance across all stakeholder themes,” Just Capital CEO Martin Whittaker, who plans to be on the call, said.

Just chairman and hedge fund billionaire Paul Tudor Jones also will join the call.

PayPal scored among the top 10 companies in Just’s latest rankings, released Nov. 12.

Broadening View

JPMorgan Chase & Co. CEO Jamie Dimon and other members of the Business Roundtable, a Washington-based lobbying group, said in August that a company’s purpose should include more than delivering shareholder value. It should also include areas like investing in employees and ethical supply chains, they said.

Most corporate board members also value the importance of customers, employees, and other non-shareholder stakeholders, according to a survey by board software provider Diligent and Stanford University. Still, only 27% of surveyed directors at U.S. companies say they face pressure from their largest institutional investors to do more for stakeholders.

“Certainly these calls won’t replace earnings calls,” Andy Call, an accounting professor at Arizona State University who has studied earnings calls, said. “But they could have the benefit of broadening the view of executives as to who they’re answering to and what performance metrics they care about most,” he said.

Just is partnering with shareholder tech startup Say Inc., whose digital Q&A platform lets individual investors in companies such as Tesla Inc. pose earnings-related questions to executives.

PayPal investors can submit questions using Say’s platform or Just’s website.

To contact the reporter on this story: Andrea Vittorio in Washington at avittorio@bloomberglaw.com

To contact the editors responsible for this story: Alexis Kramer at akramer@bloomberglaw.com; Roger Yu at ryu@bloomberglaw.com