Corporate governance - Vigil

Securities and Exchange Commission member Elad Roisman plans to leave the market regulator by the end of January, giving Democrats a bigger majority at an agency pursuing an ambitious and sometimes politically divisive policy agenda.

Glass Lewis recently released its 2022 policy guidelines, with new amendments on compensation, board diversity, and environmental and social areas. The key changes for 2022 focus on diversity and SPAC governance. This post discusses key compensation and Environmental, Social and Governance (ESG) updates.

Top U.S. financial regulators said they are prepared to take action to address risks to the financial system posed by stablecoins, but first are pushing Congress to enact comprehensive legislation providing oversight of the form of digital currency.

Last week saw a new twist in the SEC’s nearly 20-year struggle to develop a stable regulatory approach to the activities of the proxy advisory firms—principally ISS and Glass Lewis—that have come to play such an important role in shareholder voting at U.S. public companies.

Proxy advisory firms are principally in the business of advising institutional investors about upcoming shareholder votes. In July 2020, the SEC under Chair Jay Clayton amended the federal proxy rules to regulate proxy advisory firms, but that did not end the triangular controversy among the proxy advisory firms, their critics among public companies and their supporters among institutional investors.

The article argues that Delaware corporate law deploys the concept of the fiduciary and fiduciary duties to reflect two separate and wholly distinct legal ideas. The ideas have separate sources in early English and U.S. common law and equity, have structurally distinct understandings of the nature and content of fiduciary duties, and have profoundly different constituencies that may benefit from, and are able to enforce, such duties.

Corporate Governance Outlook 2022, an Equilar publication, analyzes the proxy statements and shareholder voting results for Equilar 500 companies from 2017 to 2021

At an open meeting yesterday, the SEC voted to propose new rules addressing trading in the market by insiders and companies. The commissioners voted—unanimously—to propose new rules regarding Rule 10b5-1 plans and voted three to two to propose new rules regarding issuer stock repurchases.

Dan Ammann, chief executive of General Motors Co. ’s Cruise autonomous-vehicle unit, is leaving the company, GM said, a high-profile departure from GM Chief Executive Mary Barra’s executive team.

The Board of Directors of Basware Corporation has resolved to establish a new long-term incentive structure for the company’s management and key employees, which entails two share-based plans:

Performance Share Plan 2022−2024, which steers key employees toward realizing established strategic objectives and increasing shareholder value, and
Restricted Share Plan 2022, for selected key contributors in key markets.

A group of activist investors are pressuring major tech companies to overhaul their culture and business structure, proposing shareholder resolutions aimed at reorganizing senior leadership, ending certain business practices and censoring more online content.

Two Amazon shareholders have called on the tech giant to disclose global tax practices and risks to investors, shareholder adviser PIRC said on Friday, as investors step up demands for greater tax transparency from large corporations.

According to a new study, however, neither cohort is the most likely to deliver outstanding results. “Leapfrog CEOs”—leaders appointed from one level below C-suite officers or division heads, with titles such as senior vice president and general manager—have the best odds of steering their firms into the top quartile of performers.

The dominance of a handful of tech behemoths marks a shift from the more-inclusive run-up that propelled the stock market late last year and in early 2021. Investors appeared to be returning to a favored trade of the past decade—focusing on a few large, growing, profitable tech companies—for safety, analysts said, as they contend with a string of anxieties that have sapped confidence.  

The 26th meeting of the UN Conference of the Parties (COP26) led to several newsworthy developments, with companies, countries, and coalitions announcing various initiatives and pledges throughout the thirteen-day meeting. We found the two below especially significant:

The announcement of interim targets from the Net Zero Asset Managers Initiative (NZAM), and
The formation of the International Sustainability Standards Board (ISSB), and the subsequent consolidation of the Value Reporting Foundation (VRF) and the Climate Disclosure Standards Board (CDSB).

we have determined that it is generally in the best long-term interest of our clients to promote sound corporate governance as an informed, engaged shareholder. At BlackRock, this is the responsibility of the Investment Stewardship team.

In September 2020, the Securities and Exchange Commission amended Rule 14a-8 of the Securities Exchange Act to increase the eligibility requirements for a shareholder to submit proposals.[1] Rule 14a-8, also called the shareholder proposal rule, governs when a company must include a shareholder proposal in its proxy statement.[2] Passed by a 3-2 vote, the amendments have led to contentious debates about their potential impact on corporate governance.

The purchase price is to be paid in cash, and will amount to an estimated US$13.4-billion of capital from the Canadian bank along with US$2.9-billion of cash currently held by Bank of the West, BMO said in a news release. BMO plans to use excess cash on both banks’ balance sheets to fund the acquisition

Airbus won deals to sell Dutch carrier KLM and Australia’s Qantas Airways Ltd. scores of single-aisle jets, prying away two of Boeing’s most loyal customers.

S&P Global Ratings downgraded China Evergrande Group to one of its lowest possible ratings, a cut that means the world’s three largest credit-rating firms all now judge the giant developer to be in default.

In September 2020, the Securities and Exchange Commission amended Rule 14a-8 of the Securities Exchange Act to increase the eligibility requirements for a shareholder to submit proposals.[1] Rule 14a-8, also called the shareholder proposal rule, governs when a company must include a shareholder proposal in its proxy statement.[2] Passed by a 3-2 vote, the amendments have led to contentious debates about their potential impact on corporate governance.

Australia is seeking to curb the influence of activist investors that force firms to battle climate change and hire more senior women by adopting similar laws imposed by the Trump administration last year.

So-called proxy advisory firms that consult with the nation’s biggest shareholders on corporate governance will be required to have a financial services license and prove they’re independent of their clients, according to a government statement Friday. They’ll also have to disclose their voting advice to target companies on the same day that it’s given to clients. 

McDonald’s announced Thursday it has settled its lawsuit against former CEO Steve Easterbrook, clawing back his severance payment valued at $105 million