Hedge Fund’s Control Over Wendy’s Goes Deep as Fast Food Chain Snubs Farmworkers

Image: Chris Potter, www.ccPixs.com

The Coalition of Immokalee Workers (CIW) has waged a long campaign calling on Wendy’s to join the Fair Food Program. That campaign is now gaining more momentum – receiving more press coverage, for instance – as organizers continue to try to convince Wendy’s board to have the company join the program. 

It makes sense to focus on Wendy’s board, because this is where power over the company lies. As we discuss below, Wendy’s board is effectively controlled by the hedge fund Trian Partners and its billionaire CEO Nelson Peltz. Trian is the largest institutional shareholder in Wendy’s – and its influence on Wendy’s board goes perhaps even deeper than we initially documented in our past work on Trian and Wendy’s. 

The Fair Food Program, launched in 2011, is meant to ensure better wages and safer working conditions for tomato pickers and other farmworkers who harvest produce by hand. The program, for which CIW received a Presidential Medal of Freedom, has been widely lauded as a model for the world in protecting farmworkers’ rights. Bernice Yeung, a 2019 Pulitzer Prize finalist, has called the program a ““#MeToo-era marvel” that “not only creates real consequences for harassment” of farmworkers, “but also prevents it from happening at all.” 

Walmart, McDonald’s, and other major companies have joined the Fair Food Program – but not Wendy’s.

We’ve previously reported on the role of Trian Partners’ executives Nelson Peltz, Peter May, and Matthew Peltz on the Wendy’s board. However, other current Wendy’s  board members also have ties to Trian Partners or Nelson Peltz, chair of the board. Since joining the board in 2008, Peltz has repeatedly tried to increase the number of board seats and has nominated other Trian Partners executives to the Wendy’s board. 

Of the 11 current Wendy’s board members, 7 have ties to Trian Partners or business ties to Peltz. There is Peltz himself, his son, and Peter May, but new research reveals four more Trian board ties:

  • In 2015, the same year his son Matthew Peltz was elected to the board, Peltz fought to increase the number of board seats to accommodate the addition of his son as well as Dennis Kass, one of the first members of Trian Advisory Partners. Trian Advisory Partners was formed in 2015 to support Trian in their investment decisions and is comprised of former corporate CEOs. Kass, a former CEO of Jennison Associates, is also a former Chairman and current board member of Legg Mason, which is also a major investment of Trian Partners.
  • Kenneth Gilbert, current Wendy’s Director, was also a Director of Trian Acquisition I Corp from 2007 until 2010, when the company liquidated. Gilbert was one of six people Trian Partners nominated for the Wendy’s board in 2008, the same year they proposed expanding the number of seats on the board of directors to 15.
  • Joseph Levato, a former Trian executive from 1992 to 1993, has been on the Wendy’s board since 2008. Prior to joining the Trian Group, LP, Levato was an executive at Triangle Industries from 1984 to 1988. Triangle Industries was effectively owned and operated by Nelson Peltz and Peter May in the 1980s, prior to forming Trian Partners.
  • Peter Rothschild, nominated by Trian Partners and elected to the Wendy’s board in 2010, was previously a Director at Deerfield Capital Corp, which was owned by Triarc where Peltz was CEO at the time.

Wendy’s recent SEC filings also show that four of the five current members of the Corporate Social Responsibility Committee of the Wendy’s board are current or former Trian executives – an irony, perhaps, since they have so far refused to have Wendy’s join the Fair Food Program, which has been widely lauded as a human rights success story.

Clearly, then, Trian Partners and Nelson Peltz hold major sway on Wendy’s board – in addition to Peltz, his son, and May’s presence on Wendy’s board, the board also contains a host of directors with longtime ties to Peltz and Trian. 

All this strengthens the belief that, in order to convince Wendy’s to go along with other major companies in joining the Fair Food Program, Peltz and Trian need to give the greenlight.