WILMINGTON – Just a few weeks after the activist investor Jeffrey Smith launched a campaign against company leaders, the agriscience giant Corteva reported surprisingly good earnings for the fourth quarter […]
WILMINGTON – Activist investor Jeffrey Smith, of Starboard Value LP, announced publicly Thursday that his firm is targeting the agricultural chemical and seed company Corteva, evoking memories of the company’s […]
WILMINGTON – Corteva announced Wednesday morning that CEO James “Jim” Collins Jr. will retire at the end of the year and that it is conducting an external search for his successor until then.
[caption id="attachment_212557" align="alignright" width="300"] Corteva CEO James "Jim" Collins Jr.[/caption]
Collins has spent 37 years with Corteva, the global agricultural chemical and seed company headquartered near Wilmington, and its predecessors DuPont and DowDuPont. He oversaw the company’s spin off in 2019 from the brief Dow and DuPont marriage."It has been the privilege of a lifetime to work with such an outstanding team. We have established the foundation for an exceptional company, built for sustainable growth as it serves its vital purpose. I am so proud of what we have accomplished together," Collins said in a statement announcing his decision.Collins’ departure comes after a tumultuous time for the company and its chief executive, however, as he wastargetedby withering criticism from the leading activist investment firm Starboard Value LP earlier this year. Calling Collins’ performance in creating value for shareholders “incredibly disappointing,” Starboard reportedly identified a worthy replacement to the company.Corteva’s board backed the embattled CEO though, defending his performance and steeling itself for a looming proxy fight with Starboard. By March though, and with a surprisingly good fourth quarter earnings report in tow, Starboard dropped its calls to replace Collins in an agreement that also secured three board seats for its selected appointees.The company said that Collins’ retirement comes after conversations between him and the board of directors, where all agreed “that with the company on solid ground, this is the opportune time to make a leadership change.”"Over the past several years, Jim guided the creation and launch of Corteva as a leading, independent global agriculture company and he will leave the company on a very strong footing," Greg Page, independent chairman of Corteva, added in a statement. "The Board and I are grateful for everything Jim accomplished for our company, its employees and customers, and our shareholders. Through Jim's contributions, the company is well positioned to continue strong forward momentum looking ahead. We will begin the search for Jim's successor immediately and appreciate his willingness to remain in place to assure a smooth transition."Collins joined DuPont in 1984 and served in key leadership roles across several DuPont businesses. His work in the Agriculture segment began over 35 years ago, and prior to leading the Ag segment, he led two other large DuPont business segments, Performance Materials and Electronics & Communications.Prior to the DowDuPont merger, he was an executive vice president for DuPont responsible for the Agriculture segments, which included DuPont Crop Protection and Pioneer. He helped oversee the combination of DuPont’s and Dow’s agriculture business units, and was appointed chief operating officer for the Agriculture Division of DowDuPont upon its merger."The work of successfully creating Corteva following the merger of Dow and DuPont, standing it up as an independent company, and leading it through arguably some of the most volatile periods in the history of agriculture has been both an honor and a great responsibility,” Collins said in his statement.In the two years since forming its own company, Corteva has built stable finances with gross profit rising 3% between its 2019 and 2020 fiscal years and revenue increasing 2.6% to $14.2 billion – landing it at No. 214 on the Fortune 500 list. It continues to be seen by many analysts as an undervalued stock, however, reaching a record high of $49.84 a share in May, but largely trading in the mid-$40s this year.In order to drive higher margins, Collins has overseen the closure of nine company facilities and the reduction of 25% of its manufacturing workforce due to synergies recognized following the Dow-DuPont merger. He also negotiated Corteva’s position in the agreement with DuPont and Chemours about legacy liabilities connected to so-called “forever chemicals.”Corteva’s second quarter earnings report released last month beat analysts’ expectations again, topping the consensus on revenue by $342 million. Despite the continued pressures from the COVID-19 pandemic and other international issues, Corteva increased its net annual sales forecast to between $14.6 billion and $14.8 billion, compared to between $14.4 billion and $14.6 billion forecast earlier.Aside from driving Corteva’s financial goals, Collins has also steered the company to consider its environmental, social and governance (ESG) role in the market.Last month it released its inaugural 2020 Sustainability Report, in which it details its commitment to a 65% intensity reduction for scope 1 and 2 greenhouse gas emissions, and a 20% intensity reduction for scope 3 emissions in business activities in the next decade. With this commitment, the company joins the global effort to limit global warming to 1.5 degrees Celsius above pre-industrial levels, the level set in the Paris Agreement.“We have created a special culture at Corteva, backed up by sustainability goals to advance agriculture resiliency, and I am confident that while we will see healthy change, our commitment to our shareholders, our customers, and to a safer, healthier planet will endure for years to come," Collins said.The departure of Collins will end a generation of leaders at legacy DuPont companies, as Chemours CEO Mark Vergnano announced that he is retiring July 1 and will be succeeded by Chief Operating Officer Mark Newman. At DuPont, CEO Marc Doyle was replaced in 2020 by Chairman Ed Breen, who had previously led the DowDuPont combo as CEO.