The Securities and Exchange Commission announced today that Elon Musk, CEO and Chairman of Silicon Valley-based Tesla, Inc., has agreed to settle the securities fraud charge brought by the SEC against him last week. Musk has done with his tweets what shareholders have been unable to do. This year a proposal to require an independent board chairman won only 16% of the votes. See Tesla 2018 Proxy Decisions Crucial. Maybe we will now get traction on other issues as well. Continue Reading →
Tag Archives | independence
Judicial Independence: Conflicts of Interest was the primary focus of last week’s first Rock Center / SVDX program of the academic year. It was titled Condos on Lanai, Private Planes, and Electric Cars: Judicial Views of Purported Conflicts Among Silicon Valley Director. Continue Reading →
Microcap Board Governance, a study conducted by Board Governance Research LLC commissioned by the Investor Responsibility Research Center Institute (IRRCi), examines microcap board governance at 160 companies. That represents about ten percent of all companies with less than $300 million in market capitalization traded on major U.S. stock exchanges. Continue Reading →
Ken Olisa, former ENRC director, says companies claiming to adhere to the highest standards of corporate governance while in reality remaining under the control of the founding shareholders offend the basic precept of free markets — transparency. Continue Reading →
Boards have become larger but controlling for other things, less independent (have fewer independent directors) after the crisis. Much of this seems to be the result of a “supply shock” in which independent directors have become more aware of the risks associated with board positions. In the three weeks of January 2009 after the Satyam fraud came to light, independent director exits soared to 109 from a monthly average of about 30 before the crisis. Over a longer horizon, independent director exits per year have risen by 20% in the post-Satyam period as compared to the three years before the crisis…
Executive director appointments have more than doubled in the post-Satyam period than before. Their proportion on boards has risen by 16%. (The drop in the number of independent directors in boardrooms bodes ill for corporate governance, FT, 8/20/2011)
Indian Boards should consider expanding their horizons, seeking directors from a much more diverse pool of creative professionals from outside their normal circles, including experts in social media, women and international candidates.