As discussed in prior posts, the role of proxy advisory firms has once again risen to the forefront as a sizzling corporate governance topic, just in time for the SEC Proxy Roundtable on November 15. In advance of the event,...more
The public debate about hedge-fund activism has long been informed by academic literature that found increases in shareholder value and operating performance after activist interventions. But do hedge-fund activists actually...more
As discussed in a post from February, a California bill, SB 826, addressing the issue of board gender diversity, has been making its way through the California legislature. Today, Governor Jerry Brown signed that bill into...more
In January, as discussed in this PubCo post, Nasdaq proposed to modify the listing requirements in Rule 5635(d) to -
i) change the definition of market value for purposes of the shareholder approval rule and -
ii)...more
You may have noticed that there’s still no effective date for the new Disclosure Update and Simplification, which was adopted in August. The new amendments are scheduled to become effective 30 days after publication in the...more
The specter of the possible imposition of mandatory universal proxy has long been with us. The SEC apparently considered requiring universal proxies back in 1992 and, in 2014, the Council of Institutional Investors filed a...more
ISS has posted the results of its most recent Governance Principles Survey, which can sometimes guide future ISS policies. The key areas of focus were auditors and audit committees, director accountability and track records,...more
At a meeting last week of the SEC’s Investor Advisory Committee, the primary focus of the discussion was the panoply of problems associated with the infrastructure supporting the proxy voting system, so-called “proxy...more
According to this column in the LA Times, it’s the “single most pernicious idea in modern American finance.” Can you guess? It’s the idea “that the corporation exists to ‘maximize shareholder wealth,’” the columnist...more
The idea of regulating proxy advisory firms has been in the ether for quite some time, but it’s an idea that never quite comes to fruition. However, there seems to be a lot of chatter about this topic now, raising the...more
SEC Chair Jay Clayton announced earlier this week that the SEC will be holding a roundtable to discuss the proxy process, date TBD. Potential topics include the voting process, retail shareholder participation, shareholder...more
Corp Fin has issued two new CDIs related to the voluntary submission of Notices of Exempt Solicitation under Exchange Act Rule 14a-6(g). That rule requires any person who engages in an exempt solicitation pursuant to Exchange...more
In this Reuters article, the author delivers the scoop that the SEC has shelved its 2016 proposal to mandate the use of universal proxy cards in contested elections of directors. In case you were thinking that anything from...more
New groups have recently been formed to take aim at the shareholder proposal process—its use by proponents and its implementation by Corp Fin—from both the right and the left ends of the political spectrum. In one case, the...more
Starting in 2018, new rules required disclosure of auditor tenure in audit reports. (See this PubCo post.) And, for some companies, those tenures can stretch over a century. For example, KPMG reported that it has audited GE...more
Having a board evaluation is a regular event for most public companies. But is it a productive practice or just another corporate governance kabuki—a perfunctory, check-the-box exercise with no real impact? “Board...more
According to a new report from the EY Center for Board Matters, 54% of the 2017 class of directors of Fortune 100 companies served in non-CEO roles and 40% were female. More than half of the Fortune 100 added at least one...more
For most companies, annual shareholder meetings are non-events, with little to no shareholder attendance. That’s why the concept of virtual annual meetings—which allow shareholders to overcome the logistical and financial...more
As discussed in this PubCo post, both ISS and Glass Lewis recommended voting against a proposal to ratify the appointment of GE’s auditor, KPMG, at the 2018 GE annual shareholders meeting, a pretty unusual event in itself. ...more
Just like the 2017 Consolidated Appropriations Act, the 2018 Consolidated Appropriations Act expressly precluded the use of any of the appropriated funds for issuance or implementation by the SEC of any rule regarding the...more
In this article from the Harvard Business Review, “How to Be a Good Board Chair,” the author, an academic and consultant, discusses good practices for the board chair’s role based on a survey of 200 board chairs from 31...more
For 2018, BlackRock has identified human capital management as one of its engagement priorities, echoing the exhortation from BlackRock CEO Laurence Fink in his 2018 annual letter to public companies: with governments seeming...more
Just in time to get ready for those annual meetings of shareholders, accounting firm BDO’s Center for Corporate Governance and Financial Reporting has developed a list of topics that companies should be prepared to address at...more
Last week, at a meeting of the SEC’s Investor Advisory Committee, SEC Chair Jay Clayton delivered an opening statement, part of which addressed two governance topics of recent debate. One of the topics—dual-class share...more
You might recall that, in November last year, Corp Fin issued new Staff Legal Bulletin No. 14I, Shareholder Proposals, which, among other things, addressed the “economic relevance” exclusion of Rule 14a-8(i)(5). That rule...more