Corporate governance - Vigil

Our article addresses the fundamental question: What is a corporation? Some experts say the corporation is a grantee of the state and should serve a public purpose (concession theory). Others describe the corporation as a legal entity that can hold property and enter contracts in its own name (entity theory). Still others argue the corporation is a nexus of privately-negotiated contracts (nexus of contract theory). Or perhaps a corporation is an aggregation of natural persons (aggregate theory) or an aggregation of shareholder property (property theory) or specific assets (team production)?

The American Institute of CPAs (Aicpa) has launched a reporting framework designed to help directors, management and investors assess how companies are tackling the hot-button issue of cyber-security.

In Paramount Gold and Silver Stockholders Litigation (April 13, 2017), the shareholder-plaintiffs claimed that the directors of Paramount Gold and Silver Corporation had breached their fiduciary duties by agreeing to an unreasonable “deal protection device” in connection with the merger pursuant to which Paramount was being acquired by Coeur Mining, Inc. Specifically, the plaintiffs contended that a royalty payment to be paid by Coeur was effectively a “second termination fee” that, when combined with the termination fee included in the merger agreement, was an unreasonably high fee that could deter a potential topping bid. The plaintiffs also argued that the Paramount directors had breached their fiduciary duties by “rushing” the sale process and not negotiating for a pre-signing auction of the company or a post-signing go-shop, and had acted in bad faith in agreeing to the unreasonable deal protection provisions and in providing stockholders with inadequate disclosure.

Blockholders play an important role in the governance of firms, and the SEC has taken great interest in their voting behavior. In this paper, we adapt a standard model of voting by introducing a voter who has multiple votes. This allows us to explore the role of blockholders, how their presence might affect the behaviour of other shareholders, and possible consequences of the SEC’s rules on voting.

The following blog post is one installment in a series related to board oversight of corporate culture. The National Association of Corporate Directors (NACD) announced in March that its 2017 Blue Ribbon Commission—a roster of distinguished corporate leaders and governance experts—would explore the role of the board in overseeing corporate culture. The commission will produce a report that will launch during NACD’s Global Board Leaders’ Summit Oct. 1–4.

Tomorrow [April 5, 2017] is my last day at the Federal Reserve. So in this, my final official speech, it seems appropriate to offer a broad perspective on how financial regulation changed after the crisis. In a moment, I shall offer a few thoughts along these lines. Then I am going to address in some detail the capital requirements we have put in place, including our stress testing program. Eight years at the Federal Reserve has only reinforced my belief that strong capital requirements are central to a safe and stable financial system. It is important for the public to understand why this is so, especially at a moment when there is so much talk of changes to financial regulation.

The Supreme Court heard oral arguments on April 18, 2017 in Kokesh v. SEC, No. 16-529, a case requiring the Court to decide a question with major implications for the remedies the SEC may seek in court: whether civil disgorgement is a “fine, penalty, or forfeiture” governed by a five-year statute of limitations under 28 U.S.C § 2462 or is remedial in nature and therefore not subject to any statute of limitations.

The House Financial Services Committee approved a bill Thursday to repeal and roll back significant pieces of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Merritt Fox, Zohar Goshen, and Eric Talley were among the authors of three of the 10 best corporate and securities articles last year, the Corporate Practice Commentator has announced. The Columbia Law School professors were joined by Gabriel Rauterberg, who was a research scholar at the school when he wrote one of the selected pieces with Fox and Lawrence Glosten, a professor at Columbia Business School.

Independent directors are an important feature of modern corporate law and courts and lawmakers around the world increasingly rely on these directors to protect investors from controlling shareholder opportunism. In our Article, Independent Directors and Controlling Shareholders, forthcoming in the University of Pennsylvania Law Review, we examine this reliance. We show that the existing director-election regime significantly undermines the ability of independent directors to effectively perform their oversight role.

The two biggest proxy advisory firms are offering conflicting advice over whether Bombardier Inc. shareholders should support the planemaker’s executive-compensation plan, potentially throwing more fuel on the fire of public outrage.

Cybercrime has emerged as one of the foremost threats a company faces. As a result of a few keystrokes, a company may find its customers’ data sold on the dark web, its intellectual property in the hands of a competitor or its operations paralyzed by ransomware. It should come as little surprise, then, that cybersecurity has become a key risk factor in mergers and acquisitions.

Cyber security works best from the top down. But I don’t think we are ready to have a board room full of hackers and having to many people that know enough to be dangerous is not good for any business. But what if your CEO’s and Board members had cyber security bootcamp just for them? Peter Gleason CEO on the National Association of Corporate Directors joins the conversation.