21 August 2019

$900k general counsel may have her work cut out after IPO

WeWork SEC filing ahead of IPO reveals absence of women on the board and potential exposure to foreign corruption… oh yes, and how much its general counsel earns.

By Dr David Cowan


The top woman and general counsel at WeWork gets a nearly one billion dollar package, the SEC filing reveals, but also shows no seats on the board are planned for women following IPO, and raises concerns about exposure under the Foreign Corrupt Practices Act (FCPA) and other laws.

No women on board

When the parent company of WeWork, which leases work spaces in shared offices, officially filed to go public it filed 2018 details on the compensation package given to Jennifer Berrent, WeWork's co-president and chief legal officer. Ms Berrent may, however, have her work cut out for her, due to other details revealed in the filing. It appears that WeWork’s IPO plan would see it go public with an all-male board, raising concerns that such a high-profile IPO should have no women. Roughly 40 percent of open director roles at S&P 500 companies were filled by women last year. In public offerings since April, however, women have only occupied about 18 percent of the board seats, according to executive recruiter G Fleck/Board Services. In a study of 100 IPO boards from 2014 to 2017, half went public without a single female director, said Mali Gero, co-founder and senior adviser of 2020 Women on Boards. WeWork co-founder and CEO Adam Neumann heads the company’s seven-member board. His co-founder and wife, Rebekah Neumann, and co-founder Miguel McKelvey are senior executives at the company, but are not on the proposed board.

FCPA exposure

WeWork, readying for an IPO in September, says in its SEC filing that its potential exposure to liability under FCPA is likely to increase because of the way it does business. The filing states “Under the FCPA and similar anti-corruption laws and local laws prohibiting certain corrupt payments to government officials or agents, we may become liable for the actions of our directors, officers, employees, agents or other strategic or local partners or representatives over whom we may have little actual control.” The company added, “We are continuously engaged in sourcing and negotiating new locations around the world, and certain of the landlords, real estate agents or other parties with whom we interact may be government officials or agents, even without our knowledge.” WeWork operates in 528 locations in 111 cities around the world, with 527,000 memberships able to work in those offices, Wednesday's filing said. The company lost $689.7 million in the first half of 2019 on revenue of $1.54 billion.

Email your news and story ideas to: news@globallegalpost.com