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Good morning,
This is Katherine, filling in from London for Alan and David.
Amid the regular flurry of pandemic based news this morning, one story caught my eye: the saga of a furry, plodding, hideous yet beloved boot. Yes, it’s the story of UGGs, or “uggs.”
Specifically, the story of UGG boots in the U.S., the site of a years-long legal battle between an Australian boot maker and the Californian company which makes the UGG-branded boot, over how and where the word can be used. The Aussie challenger—which lost the appeal, but has pledged to bring the case to the Supreme Court—argues that “ugg” is a generic Australian term, and should be protected in much the same way as “feta” and “Champagne.” (I, personally, would go to that party.)
Mostly, I was delighted to find out that Australians are so protective of the much-maligned boot, which is essentially a dumpling, for feet. As a Canadian, I was dragging UGGs through towering snowdrifts for years—when the boots went out of style in Los Angeles or New York, we collectively reaffirmed that the vagaries of fashion didn’t matter much when the temperature hit -30 degrees (yes, Celsius.)
Or, as it happens, when you’re in a pandemic. Perhaps that’s one of the minor takeaways more than a year in: as the lockdowns kept coming, the comfiest were cunning. Deckers—the maker of the UGG-branded boot—reported record quarterly results for its latest quarter, with revenue jumping nearly 15% year-on-year. It’s not the only beloved, comfort-driven shoe that’s managed to survive years of fashion fluctuations: over the weekend, Eric J. Lyman wrote about Germany’s Dr. Martens’ long history—and buzzy stock—for Fortune.
In other fashion-related news, Stitch Fix founder and CEO Katrina Lake appears on the Leadership Next podcast this week. When Lake took her company public in 2017, she was the youngest ever female founder to do so—a description that, by her own account, used to make her bristle.
Lake spoke to Alan and Ellen about the moment she knew she wanted to be in business, the dangerous lack of diversity amongst investors, and leading through the pandemic. You can listen or download here.
More news below.
Katherine Dunn
katherine.dunn@fortune.com
@katherine_dunn
TOP NEWS
Variant of concern
The WHO has classified the COVID-19 variant ravaging India as a "variant of concern"—the fourth such variant to get the designation. The others were identified in the U.K., South Africa, and Brazil. Some preliminary studies indicated the B.1.617 variant may spread more easily; however, the WHO reiterated that the current vaccines are effective. Deaths in India continued to sit near record highs at the start of this week. Reuters
Vaccinate the kids
Meanwhile in the U.S., the FDA has cleared the Pfizer-BioNTech vaccine for use on children 12 and over. The approval comes after a study that tested the two-shot vaccine on 2,260 children, and could widen the vaccinated population from the 114 million adults who have received the jabs—which has helped push new, recorded U.S. infections to the lowest level in 11 months. For schools and parents, the shot could make all the difference. “The vaccination is the ticket for the most normal school year possible next year,” said one school superintendent. WSJ
Then give them Instagram?
For those kids still too young to get the COVID-19 vaccine, here's another looming prospect: special Instagram accounts, from Facebook. On Monday, attorney generals for 44 states and territories signed on to an open letter declaring that this was, essentially, a terrible idea—citing the potential impact on kids' mental health, and the 20 million child abuse images that Facebook and Instagram themselves reported in 2020. Facebook said that, since kids are already using the internet, they wanted to create options for parents to have more control and visibility over what they're seeing. CNBC
Pay Backlash
Many shareholders are unhappy with executives' pay after a year of layoffs and cost cutting—and showing it. Investor support for executive bonuses in the U.S. is at its lowest since 2011, after six major companies, including Starbucks and IBM, failed to win majority support on pay packages. It's still early in the AGM season, and several more companies are at risk of losing support in the coming weeks, according to a report from Morgan Stanley. Last year, 10 companies failed to win votes on pay. FT
AROUND THE WATER COOLER
AmCham survey
It's still not easy to be an American business in China, with foreign businesses suffering "implicit bias", according to the latest study from a lobby group representing U.S. business interests in the country. "AmCham China" (American Chamber of Commerce in China) found that rising tensions between the two countries, in particular, was the main concern for its member companies in 2020. Fortune
Cyber sleuths
The Colonial Pipeline outage is still dragging on—but it could have been far worse. A group of private companies, including operators of the servers used by the hacking group, along with a wide network of U.S. agencies, were able to intervene early enough to retrieve data before it reached the attackers. Meanwhile, those same attackers—identified as a group called DarkSide—said their motivation had purely been financial, and said future attacks would avoid "social consequences." Fortune
National fliers
After the pandemic wrecked devastation on the aviation industry, an old partner stepped in: national governments. Countries that used to run national airlines have stepped back in with substantial stakes, particularly in large Europe—from Air France-KLM, to Lufthansa and Air Italia. But some, especially the continent's budget carriers, have complained of an uneven playing field. FT
The Pret Index
If you've ever been to London, you know that one item is more ubiquitous than a double-decker red bus: the Pret a Manger sandwich. (Editor's preference: the salmon baguette.) But the sandwich and coffee shop, which has been hit hard by waves of lockdowns, now serves a dual purpose: as a tracker for the pace of office workers returning to the heart of the capital—or flying out of London's airports. Bloomberg
This edition of CEO Daily was edited by Katherine Dunn.
