As expected, the U.S. Chamber of Commerce and Business Roundtable filed a legal challenge to the SEC’s proxy access rules requiring a corporation to include in its proxy materials director nominees put forward by a shareholder (or group of shareholders) who have owned three percent or more of company stock for at least three years. […]
Archive | September, 2010
Eat Faster, or Be Eaten
James McRitchie, 09/29/2010 ,
The operators of HKEx want to extend their four-hour trading day by as much as 90 minutes. Currently, stock trading at 10 a.m. and runs until 4 p.m., interrupted by a two-hour lunch break. As this article in the WSJ points out (Hong Kong Exchange’s Plan Hits a Breakwall, 9/26/2010): Competitively, the exchange needs to […]
ReformTheProxyVoteSystem.com
James McRitchie, 09/29/2010 ,
Transfer agents have launched ReformTheProxyVoteSystem.com. The site is designed to remove the “wall that’s preventing your company from gaining direct access to your shareholders” by urging shareowners to comment on the SEC’s proxy plumbing concept release. The comment period ends October 20. List of helpful resources. Among the most influential responders: the Shareholder Communications Coalition; […]
1% Transaction Tax
James McRitchie, 09/28/2010 ,
Today, over 60% of all trading on Wall Street exchanges is done by computers – all programmed to compete to get the fastest execution of their trades at the best price. Each trade generates a commission so the most trades make the most money. The latest “innovation” is “high-frequency” or “flash” trading, where the computer […]
Aftershock
James McRitchie, 09/28/2010 ,
Sebastian Mallaby reviews Robert Reich’s latest book, Aftershock: The Next Economy and America’s Future (Fairer Deal, NYTimes, 9/24/10). Reich argues that the stagnation of middle-class buying power has been a drag on growth in the American economy. At some point in the not-too-distant future, Reich warns, C.E.O.’s may find that limousines are being purposely scratched and […]
Symantec Audio-Only Meeting Gets National Coverage
James McRitchie, 09/27/2010 ,
At last, there have been a couple of articles in the national press on the Symantec Corp. virtual-only meeting. First, Ross Kerber reported for Reuters, Shareholder meetings via Web mute dissident voices (9/24/2010) Kerber observed, Soon movies might be the only place to hear pointed outbursts from investors. This year more than a dozen companies […]
Consulting Solicitation by CalPERS for Corporate Governance Analysis
James McRitchie, 09/27/2010 ,
CalPERS posted a new Consulting solicitation. Solicitation: 2010-5478 Global Equity General Consultant Services Spring-Fed Pool on 9/23/2010. Description: The California Public Employees’ Retirement System (CalPERS) seeks to establish a Global Equity General Consultant Services Spring-Fed pool to provide services, tools/technology, and data needs to the Investment Office (INVO), Global Equity Unit for a term of […]
Video Friday: Niall Ferguson & “Wall Street” the Sequel
James McRitchie, 09/24/2010 ,
Niall Ferguson: Empires on the Edge of Chaos – via Fora.Tv- Throughout history the rise and fall of empires isn’t slow or cyclical, as we like to think, but arrhythmic…it mostly happens very, very suddenly. America is a superpower on the edge of chaos, according to economic historian and author Niall Ferguson. U.S. debt levels, […]
NYSE-Sponsored “Commission on Corporate Governance” Outlines Key Governance Principles
James McRitchie, 09/23/2010 ,
NYSE Euronext (NYX) today released the final report of the NYSE–sponsored Commission on Corporate Governance. The Commission on Corporate Governance, chaired by Larry W. Sonsini, Chairman of Wilson Sonsini Goodrich & Rosati, is a diverse and independent commission established in the fall of 2009 to examine core governance principles that could be widely supported by […]
Chamber Calls for Transparency and SEC Oversight of 3D Program
James McRitchie, 09/23/2010 ,
In comments to the SEC on proxy plumbing issues, the US Chamber of Commerce expresses concern that: Directors, who are implicitly or explicitly beholden to an individual, or to a special interest group, may have a conflict of interest with the fiduciary standards that directors must adhere to. A potential example of this is the […]
CorpGov Trends at Largest US Public Companies
James McRitchie, 09/23/2010 ,
2010 Corporate Governance of the Largest US Public Companies General Governance Practices (Shearman & Sterling LLP, pdf) The survey provides a wealth of data concerning board practices at the top 100 companies. A few highlights with a focus on issues of significance to shareowners: 82 have implemented some form of majority voting in uncontested director elections, […]
CorpGov Bites
James McRitchie, 09/23/2010 ,
Lots of news I haven’t had time to fully digest but that I find interesting. Hat tip to SIF members for sending me several of these. Charade at Symantec (USPX) On September 20, 2010, Symantec Corporation set the pathetic precedent of being the first Fortune 500 company to hold a virtual-only annual meeting without shareowner-approved […]
Protesting Symantec's All-Virtual Meeting
James McRitchie, 09/22/2010 ,
Steven Towns, writing for Seeking Alpha (Questioning Symantec’s ‘Virtual’ Shareholder Meetings, 9/20/2010) joined CII, CalSTRS, CalPERS, USPX and others in objecting to an all virtual meeting held buy Symantec. This follows up on Ted Allen’s September 16, 2010 article for RiskMetrics, Investors Object to Symantec’s Virtual Annual Meeting, my post of September 7, 2010 (also […]
CalPERS Bonuses
James McRitchie, 09/21/2010 ,
The AP’s Cathy Bussewitz has done a very good job on a topic that I warned needed more attention. (AP Investigation: Calif. pension bonuses examined, 10/21/2010) CalPERS’ plunging value came as stock values tumbled around the world, the state’s economy suffered its worst decline in decades and basic state services faced severe budget cuts. Virtually […]
Fair Pay, Fair Play: Very Good Advice on Pay but Poor Sociology
James McRitchie, 09/21/2010 ,
Robin Ferracone hits the right buttons in her new volume (Fair Pay, Fair Play: Aligning Executive Performance and Pay) when she describes how to develop of an “alignment” report that can be used by boards and shareowners to ensure executive pay will be judged as “fair.” She also interviewed the right people to work in […]
What the HP Episodes Tell Us About Governance
James McRitchie, 09/20/2010 ,
The events following the dismissal of Mark Hurd at HP illustrate why I have so vehemently advocated introduction of a result orientation into governance law (Require Affirmative Proof in Specified Circumstances of “Too Big to Fail Companies” in Order to Meet the Business Judgment Rule). As we know, Hurd was dismissed in early August in […]
Section 342 of the Dodd Frank Act — Office of Minority and Women Inclusion
James McRitchie, 09/20/2010 ,
The following is from a speech by SEC Commissioner Luis A. Aguilar. Hat tip to Broc Romanek for bringing it to our attention. Congress has made clear that efforts to recruiting and promote employees from all backgrounds are efforts that the SEC, and all other financial regulators, should be undertaking. In particular, Section 342 of […]
SEC Access and Dodd-Frank Calendar
James McRitchie, 09/19/2010 ,
The SEC published Rule 14a-11 providing proxy access in the Federal Register (.pdf). The rule is effective 60 days after being published in the Federal Register, or November 15, 2010. Any issuer whose one year anniversary for mailing date is prior to March 15, 2011 will not be subject to a proxy access campaign in 2011. (Hat […]
Video Friday
James McRitchie, 09/17/2010 ,
Through PERSWatch.net, I had the distinct pleasure of sponsoring a second CalPERS Candidate Forum (the first was last year), thanks to co-sponsorship by the Sacramento Central Labor Council, facilitation by the League of Women Voters of Sacramento County, use of the CalSTRS Boardroom, video by CalPERS and cooperation from 2010 State Board Election candidate Inderjit […]
Candidate Forum
James McRitchie, 09/17/2010 ,
Through PERSWatch.net, I had the distinct pleasure of sponsoring a second CalPERS Candidate Forum (the first was last year), thanks to co-sponsorship by the Sacramento Central Labor Council, facilitation by the League of Women Voters of Sacramento County, use of the CalSTRS Boardroom, video by CalPERS and cooperation from 2010 State Board Election candidate Inderjit […]
Murninghan Post on Proxy Access
James McRitchie, 09/16/2010 ,
I’ve been tied up at a very delightful event put on by The Corporate Library, so haven’t had much time to post. However, I highly recommend Drawing Swords: The Battle Over Proxy Access for a quick overview of how proxy access is shaping up.
Response to Bainbridge Critique of Lead Director Commentary
James McRitchie, 09/16/2010 ,
In his post, Separating the CEO and Chairman of the Board, Prof. Stephen Bainbridge of UCLA Law School takes issue with my post on this site of 9-14 (Lead Directors: 2nd Best or A Valuable Tool?) in which I advise readers to consider the discussion of lead directors contained in Joann Lublin’s WSJ article of […]
CalPERS Gets Hotline
James McRitchie, 09/16/2010 ,
CalPERS announced two significant reforms designed to restore confidence in CalPERS and ethical conduct – the establishment of a Senior Level Enterprise Risk Management Office and the launch of a new Ethics Helpline to identify fraud and waste. The CalPERS Board of Administration approved the new Office of Enterprise Risk Management to identify risks in […]
Possible Reversal of Fortune for Bebchuk on Proxy Access
James McRitchie, 09/16/2010 ,
Pom Talk (New Proxy Rules Already Impacting Pending Litigation, 9/15/10) reports the SEC’s new proxy access rules, enacted on August 25, 2010 but not yet published in the Federal Register, have already found their way into court. Based on the rule changes adopted by the SEC, the Second Circuit recently remanded Bebchuk v. Elec. Arts, […]
Help CorpGov.net Get Nominated
James McRitchie, 09/15/2010 ,
Each year, LexisNexis honors a select group of Business Law Blogs. I’m not sure how well CorpGov.net fits that category but we’ve been nominated and could use some publicity for our campaigns to end the practice of blank votes on proxies automatically going to management, ensure directors are increasingly dependent on shareowners (proxy access), move […]
Lead Directors: 2nd Best or A Valuable Tool?
James McRitchie, 09/14/2010 ,
It’s common knowledge that separating the roles of CEO and Board Chairman (see Chairmen’s Forum) is considered by most the epitome of best practice, but is far from universal. In the wake of Sarbanes Oxley, many companies designated a genuinely independent director as a “lead director” to run meetings of non-management directors and represent independent […]
Documenting Share Ownership to File Resolutions
James McRitchie, 09/14/2010 ,
Hoping to put an end to the efforts by certain executives to frustrate the ability of shareowners to submit proposals, I joined with John Chevedden and Glyn Holton in providing written advice to Meredith Cross, Director Division of Corporation Finance at the SEC, on a proposed staff legal bulletin interpreting Rule 14a-8(b)(2). Our letter explains […]
How I Voted at ACAS + How ProxyVote and MoxyVote Handle Blank Votes
James McRitchie, 09/13/2010 ,
Before voting American Capital Ltd. (ACAS) I checked at ProxyDemocracy.org and saw how CalSTRS is voting. I voted with them against Harper, Lundine, Peterson, Puryer, stock option plan and against the issuance of convertible securities. CalPERS did not post how they are voting. I found no “advocates” at MoxyVote.com. Although I would be happier knowing […]
Video Friday
James McRitchie, 09/10/2010 ,
Meredith Whitney, CEO of Meredith Whitney Advisory Group LLC. In 2007, she was the first financial analyst to predict major losses for Citigroup, one of the nation’s largest financial services companies. Program from Sunday, September 5, 2010. Q&A CSpan. Hat-tip to The Big Picture. The United States of Inequality: Introducing the Great Divergence by Timothy […]
Routes to Becoming a Director
James McRitchie, 09/09/2010 ,
Toronto’s Globe & Mail ran one of the better articles I have seen on the subject (How to land a seat on a corporate board, 9/7/10). It seems the Institute of Corporate Directors has seen a 25% rise in executives enrolling in its director education program, a series of courses to prepare graduates for serving […]
Proxy Access Implementation
James McRitchie, 09/08/2010 ,
Jill Radloff, of Leonard, Street and Deinard, focuses her practice on the areas of corporate and securities law and has written a brief guide for companies that shareowners will also find useful, You Received a Proxy Access Notice — Now What? Upon receipt of a notice of a shareholder nominee under the proxy access rules, […]
Symantec Targeted for Virtual-Only Mtg.
James McRitchie, 09/07/2010 ,
Over five years, Symantec Corporation has delivered an appalling negative 50% return for investors. Management is paid excessively and has avoided communications with shareowners. Later this month, they plan to post what amounts to an Internet feed, in lieu of a regular annual meeting. This has the appearance of embattled executives hiding behind technology. Shareowners […]
SEC's Hearings on Municipal Securities Markets
James McRitchie, 09/07/2010 ,
The SEC will launch a series of field hearings to examine the municipal securities markets, starting in San Francisco on September 21. Topics will include disclosure and transparency, credit ratings, and internal controls. Among participants will be California State Treasurer Bill Lockyer, Washington State Treasurer James McIntire, and Stanley Keller, Independent Consultant and Monitor of […]
Recommended Reading
James McRitchie, 09/07/2010 ,
If we could only get retail shareholders to think and act like shareOwners, instead of people betting at the racetrack – those of us who want more democratic, more accountable corporations – would be half way there. Give everyone you know a copy of The Elements of Investing. This book by Burton G. Malkiel, the […]
Pay Ratio Nightmare Fitting Concern for Labor Day
James McRitchie, 09/06/2010 ,
US companies face a “logistical nightmare” from a new rule forcing them to disclose the ratio between their chief executive’s pay package and that of the typical employee, lawyers have warned. Yes, the disclosure required by section 953(b) of Dodd-Frank “will provide ammunition for activists seeking to target perceived examples of excessive pay and perks.” […]