Tomorrow’s Corporation that We Need Today: Getting there from here. David Langstaff, president and CEO of TASC Inc., discusses why understanding the purpose of the corporation is so important and suggests next steps. March 7, 2013. Continue Reading →
Archive | March, 2013
This is Part 3 of a post which started out reviewing the important thesis outlined in The Agency Costs of Agency Capitalism: Activist Investors and the Revaluation of Governance Rights by Ronald J. Gilson and Jeffrey N. Gordon (January 1, 2013) in Agency Capitalism: Corrective Measures (Part 1). In this post and in Agency Capitalism: Corrective Measures (Part 2) I hope to extend the work of Gilson and Gordon by offering additional avenues to counterbalance the central problem of devalued governance rights. Continue Reading →
There is nothing more controversial than setting the pay of America’s CEOs. 11:45 a.m., March 22, 2013–The John L. Weinberg Center for Corporate Governance at the University of Delaware will host a panel titled “Deemphasizing Peer Groups: What’s Next?” from 9:30 a.m.-11:30 a.m., Thursday, April 11, in Clayton Hall on UD’s Laird Campus.
The program will review the utility of using peer group benchmarking in setting executive compensation with a specific focus on what other factors should be considered by a compensation committee if peer group benchmarking is deemphasized. Continue Reading →
In The Successes and Failures of Whistleblower Laws, Robert G. Vaughn puts his life-long interest in perspective. A background with Nader’s Raiders studying federal agencies, work as an attorney representing whistleblowers, academic research and insights gained through study abroad facilitate Vaughn’s ability to evaluate the laws through theory and practice, stories and themes.
From Stanley Milgram to the Stanford prison experiments, My Lai Massacre and civil rights cases, Vaughn explores those who actually took up the adage, ‘question authority’ and the laws that evolved to protect them. He delves into famous cases, such as that of Frank Serpico and Daniel Ellsberg, as well as those far more obscure but also important. We also see how protections largely started in the civil service Continue Reading →
In light of the IPOs and subsequent performances of Facebook, Groupon, Zynga, etc., there has been renewed discussion in Silicon Valley. When two classes of common stock that place control of the board in the hands of the founders and not the investors, do investors benefit or does it just entrench management? One argument in favor of two classes of common stock is that it allows the founders to run the company without interference from activist shareholders who are “short-termers.” One argument against is that a founder who is a poor CEO cannot be removed by the board — and hiring and firing the CEO is the raison d’etre of a corporate board. SVDX‘s panel of seasoned experts hold divergent views on this topic. This program, like all SVDX programs, was subject to the Chatham House Rule. I’ve added a few links that might be helpful. Continue Reading →
After a decade of frantic corporate governance reform, business leaders may believe that governance has reached the pinnacle of responsibility and effectiveness. Not so fast, says Nell Minow, one of America’s most respected governance observers. Corporate data disclosure can still be manipulated, boards can still be opaque or unaccountable to investors, and work is still needed on corporate pay setting and transparency. Continue Reading →
The Aspen Institute fosters leadership “based on enduring values” and examines critical issues, such as the purpose of the corporation. Their business and society page is well worth reading and viewing. Here’s the opening narrative: Continue Reading →
That was the blaring headline in Ross Kerber’s article for Reuters yesterday. Unfortunately, they didn’t dump one-click voting; they renamed it.
The real change was almost entirely for appearances. We no longer have a “Vote with the Board’s Recommendations” button. Instead, we have a “Submit” button. What happens when you hit that button and don’t fill out anything else? All your votes go to the board recommended boxes. There is no change in what actually happens. If there are 20 items, it still takes one click to vote with the board, 21 to vote against the board. Continue Reading →
Guest post from Jeffrey Clements.
Make no mistake, the impact of the Supreme Court’s fiasco in Citizens United v. FEC on the elections and our government was even worse than predicted. That’s the bad news. The good news is that the forces of reform, led by the growing movement for a 28th Amendment to the US Constitution, also made a forceful showing in November. Continue Reading →
The Hewlett-Packard director elections of John H. Hammergren and G. Kennedy Thompson will be the first vote included in the 2013 AFL-CIO Key Votes Survey. The HPQ shareholder meeting is scheduled for March 20, 2013. Votes “AGAINST” HPQ directors Hammergren and Thompson are consistent with the AFL-CIO’s Proxy Voting Guidelines (Item #1-04 and #1-09 on HP’s proxy card). Continue Reading →
Starbucks ($SBUX) is one of the stocks in my portfolio. Their annual meeting is coming up on 3/20/2013. ProxyDemocracy.org had collected the votes of six funds when I checked on 3/15/2012. I voted with management 56% of the time. View Proxy Statement. Warning: Be sure to vote each item on the proxy. Any items left blank will be voted in favor of management’s recommendations. (See Broken Windows & Proxy Vote Rigging – Both Invite More Serious Crime) Continue Reading →
See the rulemaking and comments already posted to SEC site. I’m concerned that provisions meant to facilitate voting on broker platforms may lead us right back into what is essentially broker voting. See discussion of Enhanced Broker’s Internet Platform beginning on page 37. I would much prefer a more open system as I described in my Harvard Law post, An Open Proposal for Client Directed Voting. See also proxy plumbing comments by Moxy Vote and proxy plumbing comments by VoterMedia.org. Continue Reading →
This is Part 2 of a post which started out reviewing the important thesis outlined in The Agency Costs of Agency Capitalism: Activist Investors and the Revaluation of Governance Rights by Ronald J. Gilson and Jeffrey N. Gordon (January 1, 2013). See Agency Capitalism: Corrective Measures Part 1 and Part 3. Current law encourages mindless indexing of portfolios and voting like lemmings to fulfill fiduciary duties. While Gilson and Gordon stressed the need for activist hedge funds, below I explore some additional options. Continue Reading →
In their recent paper, The Agency Costs of Agency Capitalism: Activist Investors and the Revaluation of Governance Rights, Ronald J. Gilson and Jeffrey N. Gordon (January 1, 2013) argue that proposed reforms to accelerate disclosure of equity positions and prohibit certain derivatives would discourage the vital role of activist shareowners. Below, I argue in support of their position and for additional measures to counterbalance the central problem of devalued governance rights. Continue Reading →
The following is a guest post by Michelle de Cordova, Director, Corporate Engagement & Public Policy, NEI Investments. The article originally appeared on the NEI Investments website and is reproduced here with permission from both the author and the firm. NEI Investments (NEI) is a mutual fund company that “makes excellent, independent portfolio managers accessible to Canadian retail investors through two award-winning fund families: Northwest Funds and Ethical Funds.” It also has Canada’s largest team of in-house socially responsible investing specialists. Continue Reading →
Whole Foods Markets ($WFM) is one of the stocks in my portfolio. Their annual meeting is coming up on 3/15/2013. ProxyDemocracy.org had collected the votes of five funds when I checked on 3/3/2012, more were added later. I voted with management 69% of the time. View Proxy Statement. (Note to IR departments everywhere, including WFM, can’t we make all proxies indexed with hyperlinks? It would be so much easier to find the topics we’re looking for.) Continue Reading →
TDAmeritrade is running a promotional where they pay current customers $50 to refer new customers. I feel like a high school kid knocking on doors selling candy so that I can go on a class trip to Washington but it really does take money to keep up this website and to report on various corporate governance events around the country. A few $50 “donations” would really help and switching to TDAmeritrade should work out for you… better than buying a box of candy. Continue Reading →
I’m taking the day off from writing a real post. Instead, I refer you to Usman Hayat‘s informative interview of Edward Mason, secretary of the Church of England’s Ethical Investment Advisory Group (EIAG). I found it interesting how Continue Reading →
Yesterday, CalSTRS issued the following statement regarding its votes at the Walt Disney Company Annual Shareholder Meeting in Phoenix, Ariz. This statement is attributable to CalSTRS Director of Corporate Governance, Anne Sheehan.
CalSTRS, holder of more than five million shares of The Walt Disney Company stock, congratulates Disney on its most recent stock performance under the leadership of CEO Bob Iger. Disney has been an economic engine for California for decades and the legacy continues. As a shareholder, CalSTRS has benefitted from this performance. However, we see troubling governance structures emerging at Disney, which fail to protect the investment of our beneficiaries and ensure the company’s continued long-term success. Continue Reading →
I’m not endorsing their activities, I’m just passing on a press release from creative groups whose tactics are much more unconventional than mine. I think of them like The Onion, but with more of a social message… although I’m not very familiar with their work. I searched the term “shareholders” on Actipedia.org and came up with three cases; nothing under “corporate governance” or “proxy access,” so relevance may be thin for readers of Corporate Governance (CorpGov.net). Still, you never know what’s ahead without looking.
While the majority of shareholders continue to vote with management, a growing number of shareowners are giving more care and attention to how they vote, with several key votes in 2012 registering 20% or more of shareowners voting against management recommendations. Continue Reading →
The subtitle of the book edited by James Meadowcroft, Oluf Langhelle and Audun Ruud is Governance, Moving Beyond the Impasse. Progress on important issues such as climate change, biodiversity, sustainable management of lands and oceans is blocked. The book’s essays, by some of the world’s leading thinkers, explore how we got here and how we might move beyond the current impasse. Although there is some discussion of accumulation, commodification, profit motive, greed, and corporate governance, more focus on those areas is needed to make more substantial progress. Continue Reading →
Climate Change Portfolio Exposure
Boston Common Asset Management has a proposal that will appear on the proxy of PNC Financial Services ($PNC) requesting that it report to shareowners on the greenhouse gas emissions resulting from its lending portfolio and its exposure to climate change risk in its lending, investing, and financing activities. Watch for your proxy. The annual meeting will be held on April 23, 2012. According to the proposal, Continue Reading →
I recently ran across a group of cute but informative videos from Brown Dog Consulting, located near Ottawa. I’m a sucker for simple line drawn cartoons. Susan Mogensen has a great ability to boil down the message to its essence. These are short quick takes, often focusing on a single principle. Here’s a hint of the type of client she’s after: Continue Reading →