Corporate governance - Vigil

In 2010, the Supreme Court ruled in Citizens United v. Federal Election Commission that under the First Amendment, the government could not restrict a corporation’s independent political spending, even in the interest of aligning corporate expression with shareholders’ views. In contrast, an earlier Court case, Abood v. Detroit of Board of Education, conditioned the ability of unions to use fees from non-members for political spending on a mechanism for non-members to opt out of fees not directly used in collective bargaining. In Friedrichs v. California Teachers Association—currently awaiting oral argument in the Court’s October Term 2015—again deals with speech by labor unions, which the Supreme Court has compared to speech by corporations.

The long and unpleasant times for preferred shareholders at Dominion Citrus Income Fund, a public entity since early 2006, continue

Invigorating the shareholder proposal process is a top priority for corporate governance reformers. But the possibility that self-interested shareholders could use proposals to harass or pressure m...

In my paper, Whom Do You Trust? Investor-Advisor Relationships and Mutual Fund Flows, forthcoming in the Review of Financial Studies, I investigate the role of trust in the asset management industry. While there is plenty of anecdotal and survey evidence which underlines the general importance of trust in finance, academic research has been scarce due to the difficulty of quantifying and measuring trust. In this paper, I use an exogenous shock to the relationships between investors and mutual fund advisory companies (e.g. Fidelity, Wells Fargo, Vanguard, etc.) to try to tease out the effect of trust.

As everyone participating in today’s [November 19, 2015] Forum knows well, our nation’s small businesses spur innovation, produce technological change, and drive job creation across the greater economy. In fact, from mid-2009—or what some pinpoint as the end of the “Great Recession”—to mid-2013, small businesses accounted for approximately 60% of net new jobs. More recently, statistics compiled through the first three quarters of 2014 show that our nation’s 28 million small business owners have been responsible for an even greater share of overall job creation, accounting for between 73% and 84% of net new jobs during that period. There can be no doubt that facilitating an environment that nurtures and breeds successful startups and small companies is critical to the health of our greater economy.

Starboard raises the heat on Yahoo

As the 2016 proxy season approaches, every public company should consider its position on proxy access and should have a plan for responding to a shareholder proxy access proposal. Based on lessons learned from the 2015 season, this post summarizes:

Starboard Value is putting new pressure on Yahoo, calling on the company to halt the spinoff of its stake in Alibaba and instead sell its beleaguered Internet business.