INTERNATIONAL - WeWork owner, The We Company, said on Wednesday it will add a woman, Frances Frei, to its board of directors and unwound a $5.9 million (4.8 million) payment to its chief executive for use of the trademarked word “We” ahead of a planned initial public offering.
The moves come after criticism of We Company’s IPO filing last month, which showed it planned to go public with an all-male board of directors and disclosed the payment to Chief Executive Adam Neumann’s company.
“Frances Frei will join our board of directors upon the completion of this offering,” the company said in an amended filing for its planned IPO. “She currently serves as a Professor of Technology and Operations Management at Harvard Business School, and has provided human resources consulting services to The We Company since March 2019.”
The company said it will add another director to its board within a year of the IPO, “with a commitment to increasing the board’s gender and ethnic diversity.”
The We Company had originally planned to go public with an all-male seven-member board, a practice major investors such as BlackRock Inc (BLK.N) frown upon.
WeWork, which rents desks to companies and individuals with a focus on startups and entrepreneurs, has helped popularize the concept of shared office space. It was valued at $47 billion earlier this year.
Despite the company’s breakneck growth, there are concerns over a mismatch between its cash flow and liabilities, given that it rents workspace to clients under short-term contracts, but pays rent for them itself under long-term leases.
New York-based We Company, founded in 2010, saw its revenue double to $1.54 billion in the first half of this year, though its losses were 25% higher during the period than a year earlier, at $900 million.
Led by co-founder Adam Neumann, the company is looking to go public against a turbulent market backdrop, with the US-China trade dispute contributing towards the worst August in four years for stocks on Wall Street.
JP Morgan Securities and Goldman Sachs are among a nine-member underwriting team for the IPO.