December 2004

Calvert Continues Push for Women’s Principles According to Barbara J. Krumsiek, CEO of Calvert Group, the nation’s largest family of “socially responsible” mutual funds, 9,000 board seats will be opening up during the next two years. Sarbanes-Oxley’s requirements for increasingly “independent” boars has created “an unprecedented opportunity” for diversity. In 2004, Calvert filed seven resolutions […]

Continue Reading ·
Pay Without Performance

Pay Without Performance

Pay without Performance: The Unfulfilled Promise of Executive Compensation was the best book published in 2004 in the field of corporate governance. Lucian Bebchuk and Jesse Fried focus on one aspect of corporate governance, executive pay, and clearly demonstrate that many features of executive pay are better explained as a result of shear managerial power, […]

Continue Reading ·

November 2004

Monks Pessimistic on Governance Reforms In an interview published in the Nov-Dec/2004 issue of The Corporate Board, Robert A.G. Monks, probably the most influential corporate governance leader, expressed his opinion that most of the recent reforms, including Sarbanes-Oxley, have been “box-ticking.” “Genuine change has been persistently obstructed.” Pressed on Sarbanes-Oxley, Monks did admit it contained two […]

Continue Reading ·

October 2004

Disney Moves For No-Action Walt Disney Co. (DIS) has notified the SEC it intends to exclude the shareholder resolution to allow shareholder nominees on thie proxy from its 2005 ballot, arguing the proponents are out of legal bounds, according to a report in WSJ ( Disney Seeks To Thwart Pension-Fund Bid For Vote On Dir., 10/28/04) “The […]

Continue Reading ·

September 2004

Losing? Change the Rules That appears to be the thinking of Sparton Corporation (SPA). The electronics-manufacturing company held a special meeting on 9/24/04 but when it didn’t get the results it wanted, they decided to abruptly adjourn and postpone the vote for three weeks “to permit the balance of unvoted shareowners to express their votes.” […]

Continue Reading ·
RecurrentCrisis

The Recurrent Crisis in Corporate Governance

 The Recurrent Crisis in Corporate Governance pushes the edge of mainstream thought in this growing discipline. Authors Paul W. MacAvoy and Ira M. Millstein, giants in the field, have well deserved reputations as practitioners and scholars. This thin volume will quickly guide the course for progressive board members concerned with building solid companies, rather than […]

Continue Reading ·

August 2004

ESOPs Beneficial Nearly nine out of 10 (88%) companies said creating employee ownership through an ESOP (employee stockownership plan) was “a good decision that has helped the company.” Asked to quantify how the presence of an ESOP improved business performance, 65% of survey respondents indicated a better performance in 2003 relative to 2002, according to […]

Continue Reading ·

July 2004

Broadcom Settlement Pushes Democratic Corporate Governance Under the settlement agreement, the cable modem chip maker will be one of only a few US companies that guarantee a board member will be nominated directly by its shareholders. The agreement gives shareholders the ability to nominate candidates for one seat on the board, requires the board to […]

Continue Reading ·

June 2004

American Firms Scarce at UN After going it almost alone in Iraq, with a “coalition of the willing,” both George W. Bush and John Kerry appear to recognize the need to work with the Uited Nations and broad coalitions. When will American corporations learn the same lesson? Just 70 of the 1,500 companies that have […]

Continue Reading ·

May 2004

Buy Side Managers Favor SEC Proposal Despite opposition from the Business Roundtable, nearly 80% of the 120 buy side portfolio managers and research professionals surveyed by Broadgate Consultants, Inc., believe the SEC’s proposals to give shareholders more power to nominate corporate board directors is a good step toward better governance. About three-quarters of respondents believed […]

Continue Reading ·

April 2004

Self-Dealing at CalPERS That appears to be the accusation of Neil Weinberg’s article,Sanctimonious in Sacramento, in Forbes magazine. This proxy season it is opposing some or all directors at 90% of the firms whose shares it owns. Yet, Weinberg contends “if the pension fund itself were held to the same standards it demands of corporate […]

Continue Reading ·

February 2004

Volume 12, Number 1 Corporate Governance: An International Review remains the world’s premiere academic journal on the subject under Christine Mallin’s capable editorial hands. The January 2004 edition includes a review of corporate governance rating services by Howard Sherman of GovernanceMetrics International and Nick Bradley of Standard & Poor’s Governance Services group, as well as reviews of tools and rating […]

Continue Reading ·

January 2004

Corporate Monitoring Project The Corporate Monitoring Project has moved its headquarters from San Francisco to Vancouver, Canada. While broadening its focus to include Canadian companies, CorpMon.com promises to continue their primary emphasis on improving corporate governance in the USA. Their latest newsletter outlines the following developments: Three innovative shareowner proposals that have so far been submitted to six companies […]

Continue Reading ·

December 2003

Suing is Not the Answer In October, the SEC proposed a rule that would give shareholders access to company proxy ballots if a majority vote to approve a shareholder-access plan proposed by 1% or more of the company’s shareholders or if 35% of holders withhold votes for one or more board candidates. If either of […]

Continue Reading ·

November 2003

Shorting and News Searches Get Easier The SEC announced a rule to make it easier for investors to short a stock by eliminating the “uptick” rule, which bans short selling on a stock when the price is falling. The initial rule would apply to 300 companies over a two year period. In an unrelated item, […]

Continue Reading ·

October 2003

Christian Science Monitor Says Proposed SEC Hurdles Too Steep In a 10/31 commentary entitled Shareholder Power, the CSM recounts the proposed triggers that would allow shareholders to nominate a token member or two to most boards. “One trigger would be if more than 35 percent of shareholders vote to ‘withhold’ approval of a board-approved candidate. Another […]

Continue Reading ·

September 2003

Investment in Asia and Emerging Markets Up Global investors have begun to move back into Asian markets, with $14 billion (US) dollars pumped into China, Hong Kong, Taiwan and Singapore in the first 8 months of 2003, compared with less than $10 billion raised during all of 2002. Cross-border capital flows into developing countries plunged […]

Continue Reading ·

August 2003

Asian Business Dialogue on Corporate Governance 2003 The Asian Corporate Governance Association will hold its Third Annual Conference–the “Asian Business Dialogue on Corporate Governance 2003”–on Thursday, October 16, 2003 at the Ritz Carlton in Hong Kong. For a list of featured speakers and registraiton information, see the ACGA site. WorldCom Reforms WorldCom court settlement of fraud […]

Continue Reading ·

July 2003

SRI Tilted Indexes Gain 1% A simulation by Innovest for a major US pension fund found that a slight “tilt” toward certain SRI criteria resulted in gains averaging 1% for five of six portfolios, with the one fund only underperforming by 0.04%. The Innovest results directly contradicted the findings of a recently publicized study from […]

Continue Reading ·

June 2003

Independence? The spring edition of Strategy + Business, a quarterly sponsored by consulting firm Booz Allen Hamilton, carries an article titled “Corporate Governance: Hard Facts about Soft Behaviors. The authors argue against mandatory rules, such as having independent directors, since data supporting the value of independent directors has been inconclusive. Instead, companies should focus on soft […]

Continue Reading ·

May 2003

BRT Leads Opposition The Financial Times reports “the most powerful business lobby group in the US plans to ask the Securities Exchange Commission to delay sweeping reforms that investors say will improve shareholder democracy. Public and union pension funds, as well as individual investors, hope the SEC will change rules on proxy filings to make it easier […]

Continue Reading ·

April 2003

California Supreme Court Ruled CalPERS in Violation The California Supreme Court has ruled that CalPERS violated several state laws. The decision also extends to CalSTRS, the nation’s 3rd largest pension fund. According to the press, the justices let stand a January appeals court ruling in a lawsuit brought by former state Controller Kathleen Connell who […]

Continue Reading ·

February 2002

Employees, Our Most Important Resource Most companies say their employees are their most important resource. Yet, they pay their CEOs more that 500 times the average worker. Successful companies with employees stock ownership plans (ESOPs) far outnumber those whose ESOPs have failed, employee ownership advocates point out. According to data from the National Center for Employee […]

Continue Reading ·

October 2002

Webster Named The US Securities and Exchange Commission voted to approve five members of a new national accounting oversight board to be headed by ex-FBI-CIA chief William Webster whose only experience in accounting, as far as we know, was heading the auditing committee of U.S. Technologies, now bankrupt and facing fraud accusations. Shortly before Webster […]

Continue Reading ·

September 2002

CorpGov Bites How the Corporate Landscape Is Changing. CFO.com outlines the prospects for pages of corporate governance reforms. Providence Capital to another institutional shareholders meeting. This one will focus on Healthsouth (NYSE: HRC). Items on the agenda include Medicare issues, current leadership and business strategy, the Company’s corporate governance and the host of lawsuits recently […]

Continue Reading ·

August 2002

Board Services Grow Houlihan Lokey Howard & Zukin introduced a new Board of Directors Advisory Service to support outside directors with their increasingly demanding fiduciary duties. Houlihan Lokey will assign a team of investment bankers to provide information, analysis and advice to board members. The Service will review information supplied by clients, analyze the companyís financial […]

Continue Reading ·