Corporate governance - Vigil

'The biggest investment failure of my career happened in the last 18 months or so,' Ackman said

In the article Compensation Goals and Firm Performance which is forthcoming in the Journal of Financial Economics, we study the growing use of specific performance goals in top executive compensation packages. A recent survey by the consulting firm Hay Group found that more than half of the CEOs in their study have compensation tied to explicit goals, up from around 35% just four years earlier. Prominent shareholders like Warren Buffet agree with the need for such targets, stating: “Lacking such [goals], managements are tempted to shoot the arrows of performance and then paint the bull’s-eye around wherever it lands.”

In Corporate Governance of SIFI Risk-taking: An International Research Agenda, a chapter forthcoming in Cross-Border Bank Resolution (Bob Wessels & Matthias Haentjens, eds., 2017-18), we suggest a framework for examining how corporate governance regulation could help to control excessive risk-taking by systemically important financial institutions (SIFIs) and analyzing how that regulation should be evaluated. Our purpose is not to provide definitive and complete answers; instead, we offer a possible research agenda of critical issues for scholars, policymakers, and regulators around the world to consider.

Bonuses for many grocery executives are being curbed last year as the sector struggles, potentially making it harder for retailers to attract the kind of talent they need to turn around their businesses.

Barry Critchley: If nothing else, the situation at Liquor Stores N.A. calls for careful reading of all the relevant material prior to the June 20 meeting

Among the settlement terms in the proxy contest between Arconic Inc. and Elliot Management is an agreement to reincorporate to Delaware due to the corporate governance provisions in the company’s charter.

Banks need to keep close tabs on key outside vendors – and their boards must devise other ways to do so if such vendors aren’t forthcoming with necessary information, regulators have told the industry.

The Trump administration has sent signals that the White House would support legislation that would function to reinstate the provisions of the Depression-era Glass-Steagall Act separating commercial and investment banking, which were repealed by the Gramm-Leach-Bliley Act of 1999 (the “GLBA”).

Having women on a company's board of directors leads to better stock market returns and that’s information institutional investors can use, a new report says

ESG matters have been in the spotlight this proxy season, and look set to be prominent in discussions at the upcoming Society for Corporate Governance’s national conference in San Francisco, which starts later this month.

The SEC recently settled with the former Chairman and CEO of MDC Partners, Inc. for $5.5 million concluding a years-long investigation into his receipt of perks and the related disclosure in the company’s proxy statements. MDC settled with the SEC for $1.5 million in January 2017.

With the first ever 2 degrees Celsius campaign proposal recently passing at Occidental Petroleum, this post looks at the increasing success of climate change shareholder proposals alongside Proxy Insight data on the subject.

While activism is a longstanding practice, the growing influence of activist campaigns has grown and gained media attention

People familiar with the process say ongoing talks with the OSC are aimed at a settlement that would include both the company and the accused individuals

Shareholders and members of the public have a vested interest in understanding the reasons behind CEO and senior executive departures. Because of the influence these key individuals have on corporate performance, investors want to know whether executive turnover is the result of a carefully planned transition or whether it is instead due to forced termination for poor performance or governance-related issues. Unfortunately, succession at many companies tends to occur in a black box. Members of the public are not privy to the boardroom discussions that precede turnover events, and the public statements announcing executive departures usually contain boilerplate language that does little to elucidate the factors that led to their occurrence. [1] This lack of clarity makes it difficult for shareholders to determine the degree to which board members hold senior executives accountable for performance and to assess governance quality.

On May 22, Department of Labor (DOL) Secretary Alexander Acosta capped months of uncertainty about the DOL’s fiduciary duty rule by announcing that the June 9 compliance date would not be delayed further. [1] While this means that the rule’s “best interest” standard for retirement advice will go into effect on June 9, full implementation of the rule is not scheduled until January 1, 2018. Following Secretary Acosta’s announcement, the DOL clarified its policy on enforcement through the end of this year and released a new set of responses to frequently asked questions (FAQs), one of which made clear that it will continue an in-depth analysis of whether the fiduciary rule harms retirement investors or the industry, as directed by a February White House Memorandum (Memo). [2]

On June 5, 2017, the Supreme Court unanimously held that the five-year statute of limitations in 28 U.S.C. § 2462 applies to claims for disgorgement by the Securities and Exchange Commission (“SEC”). The Court’s opinion in Kokesh v. SEC expands upon its 2013 decision in Gabelli v. SEC to prohibit the SEC from seeking to recover monetary relief for conduct that occurred outside the five-year statute. This opinion may have the greatest impact on enforcement areas that tend to be resource-intensive or difficult to investigate, such as claims under the Foreign Corrupt Practices Act, but may also incentivize the SEC to speed the pace of its investigations and its use of tolling agreements.

Delaware’s domination of corporate law in the U.S. has long fascinated academics. While there is wide consensus that Delaware’s preeminence arose out of decades of state-to-state competitive pressures, there is sharp disagreement and debate about the nature of those competitive pressures, that is, whether the competition has been a salutary or nefarious one—a race to the top or to the bottom. Both sides of the debate believe that states compete to attract corporate franchise tax revenues, but they differ as to what the estimated $500 million annual prize incentivizes states to do. Race-to-the-top theorists argue that the prize motivates states to compete to make better, more efficient, corporate law in an effort to discourage shareholders from causing a reincorporation outside of Delaware. Race-to-the-bottom theorists argue that the prize motivates states to pander to managerial interests because managers are the constituents that control the initial incorporation decision.