WeWork IPO: Group overhauls corporate governance

WeWork has moved to overhaul its corporate governance in an effort to save its initial public offering (IPO). The update comes amid concerns over the highly-anticipated WeWork IPO after it emerged this week that the company’s biggest outside shareholder, Japan’s SoftBank, had urged the office space manager to shelve the float amid concerns over its valuation.

Corporate governance overhaul

Office space manager WeWork announced changes to its corporate governance structure, saying in a statement to the US Securities and Exchange Commission this Friday that it would appoint a lead independent director by the end of the year. The group will also reduce the voting power of co-founder Adam Neumann from 20 to 10 times the power of an ordinary shareholder. The company further said that any chief executive who succeeds Neumann would be selected by the office space manager’s board of directors.

“We are making a number of changes to our proposed governance structure in response to market feedback,” WeWork said in the statement. The update comes after the Financial Times reported last night that the company’s executives, investors and advisers were discussing curbing the voting power and changing Neumann’s role in succession planning.

Today’s move comes after WeWork recently responded to governance concerns  by unwinding a $5.9-million payment it made to an investment vehicle managed by Neumann for use of the trademarked word ‘we,’ and added a woman to its all-male board. The company said today that it had “committed to adding another director to our board within the next year, with a commitment to increasing the board’s gender and ethnic diversity”.

Group to pursue NASDAQ listing

WeWork also said in today’s statement that it had chosen NASDAQ for its IPO, and that its Class A common stock has been approved for listing on the exchange under the trading name ‘WE’.