Corporate governance - Vigil

Hedge fund activism is to corporate law’s early 21st century what the hostile takeover was to its late 20th century.  Like the hostile takeover, activism threatens incumbent managers and disrupts their business plans by successfully appealing to the shareholders’ interest in immediate returns.

The Conference Board Measure of CEO Confidence™, which had increased in the second quarter of 2016, retreated slightly in the third quarter. The Measure now reads 50, down from 52 in the previous quarter (a reading of more than 50 points reflects more positive than negative responses).

Nonprofit board experience can help senior managers strengthen their leadership skills and connections with high-powered players.

ISS received 439 responses to this year’s policy survey, from 417 organizations. One hundred and twenty of the respondents were institutional investors, representing 115 organizations, including 73 asset managers or investment managers, 16 mutual funds, 15 government or state-sponsored pension funds, three foundations/endowments, three insurance companies (investment side), two alternative asset managers, and two labor union pension funds.

On September 2, 2016, the Investors’ Exchange, LLC (IEX) commenced full operations as a registered national securities exchange. After receiving over 400 comment letters during the U.S. Securities and Exchange Commission’s (SEC) review and a spirited debate on equity market structure, the SEC approved IEX’s application to become a national securities exchange on June 17, 2016. [1] As highlighted in the widely read book Flash Boys, by Michael Lewis, IEX employs a speed bump or delay on market participants accessing liquidity on IEX (IEX access delay).

CEOs believe cyber-security is the top risk they face, according to KPMG’s US CEO Outlook 2016 report, with 38 percent of respondents saying they are concerned about cyber-security risk.       

Learn ways organizations can begin to prepare for a future cybersecurity examination engagement.

Legendary film star Mae West once remarked, a little knowingly, that “too much of a good thing can be wonderful.” But in the financial world, where access to information is generally considered a very good thing, is more information necessarily better?

In its 2016 fall term, the U.S. Supreme Court will have the opportunity to consider two cases involving securities laws, one of which is already on the calendar for oral argument. The cases concern the “personal benefit” required to establish liability for insider trading and the jurisdictional requirements for class actions under the Securities Act of 1933. Depending on how the Court rules, the implications for companies, their constituents and practitioners could be profound.

Active Ownership Capital (“AOC”), an activist investment company that takes minority positions in undervalued small to mid-size publicly traded companies in Western Europe and the Nordics, recently won a small, but significant, victory in a proxy battle it waged against STADA Arzneimittel AG (“STADA” or the “Company”), a publicly listed pharmaceutical company based in Germany. AOC, the owner of between 5% and 10% of the capital stock of STADA, sought to replace multiple members of the Company’s Supervisory Board at its 2016 Annual General Meeting (“AGM”).

Was the global financial crisis the cause of credit unavailability, or was it the effect? The standard story is that the financial crisis resulted in the loss of credit availability. In a keynote address for a University of Durham/Newcastle University symposium (linked here as a more complete and footnoted article), I argue that story is reversed and examine what lessons that can teach us.

Board directors are using a magnifying glass to evaluate an organization’s approach to reputational risk management to gain a competitive edge.