Corporate governance - Vigil

A spin-off involves the separation of a company’s businesses through the creation of one or more separate, publicly traded companies. Spin-offs have been popular because many investors, boards and managers believe that certain businesses may command higher valuations if owned and managed separately, rather than as part of the same enterprise.

The corporate governance implications of concentrated ownership have become topical with the success of companies with large controlling shareholders, such as Facebook, Google and Amazon. The debate on the perceived short-termism related to dispersed ownership has also increased interest in governance models based on monitoring by large shareholders. As a result, Nordic corporate governance models have been subject to increasing interest in the international corporate governance debate. The Nordic corporate environment has generally been characterized by a prevalence of concentrated ownership and by the use of control enhancing mechanisms by large shareholders. Yet private benefits of control extracted by controlling shareholders have been reported to be relatively low. This combination has been seen to reflect a competitive governance model.

The Bank of Canada’s Annual Report for 2015 was tabled in the House of Commons today.

Tom Atkinson’s departure means the regulator will be searching for a new head of enforcement at the same time as it is in mid-search for a new executive director

The leading British institutional investors, acting through The Investment Association and with the encouragement and participation of the British government, today issued a report detailing steps that the investors will take, and encouraging the UK listed companies they invest in to take, to curtail short-termism and encourage long-term investment.

Proxy Cards Must be Impartially Labeled, according to new SEC guidance... but does it apply to VIFs? Who will enforce? How do shareholders open a case? Help

The automation of work and the digital disruption of business models place a premium on leaders who can create a vision of change and frame it positively.

The world of corporate governance is undergoing two intense, inter-related debates. One is a debate as to whether profit-maximization in the short term is really different from profit-maximization in the long term, and if so whether American corporations are currently too short-termist.

A company that borrows or issues floating-rate debt—debt with an interest rate that periodically resets based on an underlying index (typically LIBOR or EURIBOR)—will often hedge the risk of an increase in the floating rate by entering into an interest rate swap agreement (“IRS”). Under an IRS, such a borrower or issuer—the “fixed-rate payer”—agrees to pay periodic “fixed amounts” to its swap counterparty based on an agreed “fixed rate,” in exchange for the payment of periodic “floating amounts” by the swap counterparty—the “floating-rate payer”—based on a “floating rate” equal to the underlying index of the debt instrument the borrower or issuer is seeking to hedge.

The past year has been marked by a continued focus by shareholders and investor groups on executive compensation, and a related continued need for compensation committees to proactively manage their companies’ communications with shareholders and proxy advisory firms—both in the context of the nonbinding, advisory “say-on-pay” votes required by Dodd-Frank and also as preemptive actions against possible shareholder activists seeking the means by which to challenge board composition. 2015 also witnessed finalization by the U.S. Securities and Exchange Commission (the “SEC”) of the long-awaited pay ratio disclosure rules, and continued action from the plaintiffs’ bar challenging compensation decisions.

Bombardier reportedly plans to move Canadian jobs to China and Mexico.

This post is based on the third edition of Proskauer’s IPO Study. In the complete publication, you’ll find our analysis of market practices and trends for U.S.-listed initial public offerings (IPOs). Our proprietary database and analyses now cover 309 IPOs that priced between 2013 and 2015.

Just 15 years ago, cross-border digital flows were almost non-existent. Today, they exert a larger impact on global economic growth than traditional flows of goods, write James Manyika, Susan Lund, and Jacques Bughin in The World Post.

Yum Brands has started discussions with several financial firms, including KKR & Co., Baring Private Equity Asia and Chinese funds, about selling a stake in its Chinese operation as part of a plan by the restaurant giant to spin off the once fast-growing business.