AstraZeneca CEO Family Linked To Major Partner Investment Raises Questions

Sir Pascal Soriot, chief executive of AstraZeneca, has come under scrutiny following revelations that his family invested in an organisation recognised as a significant partner of Britain’s largest public company. The financial link has prompted questions regarding transparency, possible conflicts of interest, and governance at AstraZeneca.

Until November last year, Soriot, aged 66 and one of the best-compensated and longest-serving FTSE 100 leaders, was listed as one of four shareholders in Understorey Ventures Pty Ltd together with his wife and two adult children. Soriot subsequently transferred his shares to his family. Understorey’s portfolio includes approximately seven million Australian dollars in loans to Greening Australia, a non-profit organisation, along with a stake in one of its subsidiaries.

AstraZeneca launched a significant project with Greening Australia in 2020, committing to plant 25 million trees across the country. The initiative represents one of Australia’s largest privately funded restoration campaigns. Soriot’s tenure at AstraZeneca has coincided with major environmental engagements, including the expansion of the company’s sustainability strategy.

Understorey Ventures, which has not been disclosed to AstraZeneca shareholders, describes itself as a private impact investment office targeting environmental regeneration. The group was registered in 2021 at the Sydney office of Mutual Trust, a firm specialising in services for Australia’s leading families and enterprises. The directorship of Understorey Ventures is held by Soriot’s son, and last year its address was transferred to a Melbourne office associated with Deloitte Private.

Greening Australia pledged its shares in SeedX, a subsidiary focused on native seed production, as collateral for the loans from Understorey Ventures. Understorey’s investment activity also includes backing Planet Fund, managed by Ecotone Partners in Victoria, which supports early-stage businesses in environmental technology.

AstraZeneca announced a four hundred million US dollar global investment in 2023 to expand its AZ Forest programme, pledging to plant two hundred million trees internationally by 2030. The flagship initiative aims to eliminate the company’s residual carbon emissions by that year. In the United Kingdom, partnerships with Forestry England and Borders Forest Trust Scotland have seen the planting of over four hundred seventy thousand trees.

The Times put several questions to AstraZeneca concerning the disclosure of Understorey Ventures, the awareness of the company’s board regarding Soriot’s shareholding, and the potential overlap between personal and corporate interests. AstraZeneca stated there are no governance issues, affirmed that Understorey Ventures was disclosed to its board, and clarified that the entity was structured as a trustee company rather than for direct personal benefit. Additionally, AstraZeneca maintains that Soriot was not involved in negotiating the contract with Greening Australia, which predated the formation of Understorey Ventures.

Soriot has recently transferred substantial wealth to his family, gifting shares in AstraZeneca worth approximately seventeen point six million pounds last month, following a previous gift valued at two million pounds in 2017.

Questions persist regarding the sufficiency of disclosure practices and the company’s broader governance standards amid AstraZeneca’s ongoing growth and environmental commitments.