Archive | February, 2011

Few Whistleblower Tips: Let's Try Publicity

The SEC’s new whistleblower program is attracting far fewer tips than expected, despite richer rewards, just 168 complaints alleging corporate fraud in the first 6½ months of the program’s existence, a lot less than expected by Steven Kohn, executive director of the National Whistleblowers Center. (SEC Whistleblower Call Draws Few Tipsters, Kaja Whitehouse, New York […]

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California Corporate Governance Network

Another resource added to the Internet: The California Corporate Governance Network was developed to create a coalition of California pension plans to advocate for corporate governance best practices. Within California there are several pension plans that range in size from the largest two state plans to the local county funds. Collectively these plans provide for […]

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Progress but IFRS Delayed in India

The government notified 35 accounting standards with a view to update Indian accounting norms in line with the global audit practice IFRS. The companies, however, will be given time to adjust to the new accounting standards as government has now deferred the implementation of the International Financial Reporting Standards (IFRS) beyond April 1 this year.  […]

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Delaware Chancery Should Refocus

Governance practitioners should be aware of two very recent Delaware Chancery cases which are likely to have a significant effect upon business practices. In the first, Air Products and Chemicals, Inc. v. Airgas, Inc., et al and In re Airgas Inc. Shareholder Litigation, Civ. Act. Nos. 5249-CC and 5256-CC February 15, 2011, the Delaware Chancellor in […]

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Worried About Women on Boards? Don't Be

A U.K.-government-commissioned review by former trade minister Lord Mervyn Davies into board diversity, published Thursday, recommended FTSE 100 boards should aim for a minimum 25% female representation by 2015, up from 12.5% in 2010. Unlike Norway and Spain, Lord Davies doesn’t believe in setting hard quotas. Worryingly, he doesn’t rule them out if a business-led […]

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Apple Invesotrs Win on Majority Vote

Apple tasted defeat at its annual meeting yesterday when CalPERSs, the California pension fund, saw its resolution in favor of majority voting for directors passed by shareholders. (Apple Loses Investor Vote, 2/24/2011) At Apple’s annual meeting on Wednesday, about 74 percent of votes cast favored a proposal by Calpers that unopposed candidates for the company’s […]

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Bebchuk on Airgas

In a major decision issued last week, William Chandler of Delaware’s Court of Chancery ruled that corporate boards may use a “poison pill”—a device designed to block shareholders from considering a takeover bid—for as long a period of time as the board deems warranted. Because Delaware law governs most U.S. publicly traded firms, the decision […]

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Shareholder Democracy is Essential

John Carney, the CNBC.com business journalist, doesn’t like shareholder democracy. He argues that reforms, such as say on pay rules, which give shareholders a non-binding vote on executive compensation, won’t improve corporate governance anymore than electoral reforms have improved our government. But his views are based on antiquated notions about shareholders, and a distorted view […]

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Review: Presenting to Boards

Presenting to boards is just like presenting to any other group, right? Wrong. Most boards suffer from attention deficit disorder. Many of the members of most boards that I have encountered won’t sit through a presentation of more than a few minutes without disruption. You’ll need to focus like a laser on your main points; […]

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Addressing CEO Pay

Regarding CEO pay, Nell Minow recently wrote, “there is a little flicker of light at the end of the long, dark tunnel of outrageous pay.” Her signs of hope: Required advisory “say on pay” (SOP) vote. Last year after a “no” vote,  Occidental Petroleum’s board reduced the pay package for CEO Ray Irani and announced […]

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Increased Investor Engagement

The first comprehensive analysis of the engagement between investors and public U.S. corporate issuers finds a notably high and increasing trend of engagement.  Yet, there is a disconnect between investors and issuers in basic areas such as the time frame of engagement, the definition of a successful engagement and, by implication, what engagement itself means. “The State of Engagement […]

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Star Power Economy May Lead U.S. to Ruin

You want to win elections, you bang on the jailable class. You build prisons and fill them with people for selling dime bags and stealing CD players. But for stealing a billion dollars? For fraud that puts a million people into foreclosure? Pass…  make them pay a fine instead. But don’t make them pay it […]

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How I Voted at Apple

There was never any question in voting my shares of Apple. Egan-Jones Proxy Services, Glass, Lewis & Co. LLC, and ISS Proxy Advisory Services all endorsed a majority vote election standard proposed by CalPERS for unopposed board candidates. Who wouldn’t? If shareowners can’t make the nominations, they should at least be able to turn out directors […]

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Shareholder Democracy: A Bad Idea?

At the corporate governance level, the problem is that things like say-on-pay introduce complicated elements into proxy elections. These complexities make it difficult for ordinary shareholders, typically equipped with only a passing interest and knowledge of the issues at hand, to form preferences, much less vote their preferences. (Why Shareholder Democracy Is a Bad Idea […]

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Transform the Nominating Committee

There are important advantages to a shareholder/stakeholder-based nominating committee: It ensures that the shareholders as a whole elect directors from a list of nominees with the societal, industry and other essential expertise and contacts, desired not only by the owners, but also by other critical stakeholders. It requires only a limited time commitment (to the […]

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Save SEC & CFTC Budgets: Write Congress Via ShareOwners.org

If you loved the Great Recession and Bernie Madoff, you’ll probably endorse proposed funding cuts to the SEC and CFTC. If you’d like to avoid another financial disaster and think investors should be protected, go to ShareOwners.org to send a message to your Congressional representatives to oppose the cuts. I did; its quick and easy. […]

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Shareholder Activism in U.S. Public Companies, 1900-1949

“Offensive shareholder activism” involves buying up sizeable stakes in underperforming companies and agitating for changes predicted to increase shareholder returns. Though hedge funds are currently highly publicized practitioners of this corporate governance tactic, there has been no analysis of the extent to which managers of U.S. public companies were faced with challenges of this nature […]

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Join ShareOwners.org's Campaign to Save SEC & CFTC Budgets

A major Web-based campaign to save the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) from the impact of proposed budget cuts will be launched at 1 p.m. Wednesday (February 16, 2011) by ShareOwners.org in cooperation with the Consumer Federation of America (CFA) and the Council of Institutional Investors (CII). […]

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Hands-On Investing

From the title, I was hoping the New York Times was actually going to profile investors who give as much thought to ownership as they do to buying and selling. (Financial Advisers Want Hands-On Investors – NYTimes.com, 2/9/2011) United Capital Financial Partners to serve people who had $500,000 to $10 million, but to really concentrate […]

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Cambridge Launches Masters Degree in Corporate Law

The University of Cambridge has announced its first entirely new degree in Law since the 19th century with the launch of a Master’s degree in Corporate Law (the MCL). The MCL will begin in the academic year 2012-13 and will operate as a full-time nine-month programme, offering students the opportunity to engage in a detailed […]

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Encourage Home Ownership, Not Tax Avoidance

We should recognize the dire consequences of our nation’s tax policy, which encourages consumers to amass huge levels of debt when buying a home. Why not reward borrowers who have more equity in their homes instead? One way to do this would be to provide tax credits to borrowers based on the amount of their […]

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Nominate Rising Stars of Corporate Governance 2011

Nomination Deadline is MARCH 31, 2011. Click to Nominate a Rising Star! The Millstein Center is now accepting nominations for its fourth annual global “Rising Stars of Corporate Governance.” This award recognizes people who, while young and possibly new to the field of corporate governance, are making their mark as outstanding analysts, experts, activists or managers. […]

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New Compendium Hits the High Points

Corporate Governance: A Synthesis of Theory, Research, and Practice (Robert W. Kolb Series) edited by H. Kent Baker and Ronald Anderson provides an excellent overview of contemporary issues in corporate governance with a primary focus on the relationship between managers and shareowners, as well as other stakeholders. One of the more interesting and creative chapters […]

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Are Proxy Access Bylaws Legal?

The highly respected California attorney Keith Paul Bishop seems to think it could be argued, depending on the state of incorporation (Are Proxy Access Bylaws Legal?, Corporate and Securities Law, 12/8/2011). Most need no reminder that in 2009 Delaware enacted legislation, H.B. 19, 145th Gen. Assem. (Del. 2009), to explicitly authorize proxy access bylaws.  Tit. 8, Del. Code § […]

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Worker-Owned Cooperatives

“The worker-owned cooperative, an economic workplace model that has been around for decades is making a comeback. In some parts of the U.S. new coops are sprouting up, cutting unemployment rates and revitalizing economically depressed communities.” via Can Worker-Owned Cooperatives Offer A Solution to Our Economic Woes? | La Prensa San Diego, 2/11/2011. The corporate […]

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Protect Your Pension

On February 28 and March 1, learn how to protect your pension fund. The Los Angeles Trustee Network invites a frank discussion of issues. Major and minor public pension funds from around California will be represented at this free, very informative conference at the Sheraton Gateway at LAX in Los Angeles.

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Don’t Toss That Proxy! Learn From CalPERS

Resolution MB 8/09, approved at CSEA’s last General Council, sought to expand on the leadership CalPERS has shown in the area of corporate governance by exploring how CalPERS could better influence the proxy voting of its own members and in helping us to evaluate which mutual funds vote in alignment with our own values and […]

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