Archive for November 19th, 2010

NACD Urges SEC to Consider Adjustments to Proposed Say-on-Pay Rules

by PRNewswire, November 19th, 2010.

Issues Formal Recommendations on Behalf of Corporate Directors Warning Against Unintended Consequences of Universal Requirements.

In response to the U.S. Securities and Exchange Commission (SEC) request for comment on say-on-pay, the National Association of Corporate Directors (NACD), the largest membership organization inthe United States representing corporate directors focused on demonstrating exemplary board leadership, today issued formal concerns regarding proposed new say-on-pay rules for executive compensation plans, cautioning against dependency on regular, yes-or-no votes.

NACD’s opinions are grounded in its more than 30 years of proprietary research across a broad range of board leadership and corporate governance topics, insights expressed through confidential peer exchanges with its membership spanning F100 through mid-cap and small cap companies, and best practices detailed in its Blue Ribbon Commission reports. Furthermore, NACD’s comments were reinforced by a national survey issued after the SEC’s request for comment and drew over 280 responses from its corporate director members across America.

Representing the voice of its more than 10,000 corporate director members, and amplifying performance requirements of the director profession, NACD urges the SEC not to issue universal requirements, but to allow companies to determine the most appropriate means of communicating with and seeking feedback from shareholders as a more effective governance practice. Additionally, NACD provided the SEC with specific views on frequency of say-on-pay votes, say on golden parachutes and other matters pertaining to executive compensation on behalf of the director community. (continue reading… )

Frequency Becoming Focus of Say on Pay Battle

by Gary Larkin for The Governance Center Blog, November 18th, 2010.

The battle over advisory Say on Pay votes at public companies, which will be in full force this spring, is coming down to frequency, rather than what’s in the plans themselves. In the last week alone, the topic has been hotly debated in a Governance Center Directors’ Institute Roundtable and a Conference Board Knowledge Series Webcast on new governance requirements.

Most likely, the reason for the focus on management say on pay (MSOP) frequency proposals was the Institutional Shareholder Services (ISS) release of its 2011 proxy voting policies for public comment late last month. The ISS, whose stature seems to grow as shareholders attempt to gain more access to proxies, issued its preliminary policies on Oct. 27 with an eye on publishing its final global policy summary and concise guidelines in late December. The ISS public comment period closed on Nov. 11.

Of the many policies included in the preliminary document, Say on Pay, specifically frequency, is among the most controversial. For the first time, ISS has decided it will “adopt a new policy to vote in favor of companies providing for annual MSOP proposals.”

The ISS’ reasons for this decision? “ISS supports an annual MSOP for many of the same reasons it supports annual director elections rather than a classified board structure: because it provides the highest level of accountability and direct communication by enabling the MSOP vote to correspond to the information presented in the accompanying proxy statement for the annual shareholders’ meeting.” (continue reading… )

 

Importance of corporate governance for SMEs

by The Best Enterprise Risk Management Framework Executive Summary Data, November 18th, 2010.

There are several definitions of corporate governance. But that describes most appropriate definition is more small and medium-sized enterprise (SME) corporate governance as “a set of rules, regulations and structures to achieve the objectives, optimal performance, companies should take appropriate effective steps to” hand. In other words, it refers to discipline or internal corporate governance systems that govern relations”Key Player” or companies that are significant to the organization’s performance. It also supports the organization of long-term sustainability, and provides accountability and responsibility.

The guidelines aim to achieve corporate governance, greater transparency, fairness, and maintain operation of the organization responsible for the shareholders. Corporate governance plays the central role in the protection of shareholders andIn the meantime, give due consideration to the interests of society as a whole, without prejudice to the rights of workers. While the management, companies should have a reasonable level of energy to function, corporate governance ensures that the remit of these practical dimensions adjusted to minimize the abuse of authority, not necessarily a goal of servingthe best interests of shareholders. Therefore, it provides a framework for profit maximization, promotionInvestment opportunities and ultimately create more jobs. (continue reading… )

Video on The Board/Investor Relations Officer Relationship

by The Boardroom Channel, November 18th, 2010.

TK Kerstetter, President, Corporate Board Member
Scott Cutler, Executive Vice President, NYSE Euronext Inc.
Jeffrey D. Morgan, CAE President & CEO, National Investor Relations Institute

Watch the video here.

‘Women severely under-represented in corporate boardroom’ says Lucy P. Marcus

By Cathy Rose A. Garcia and Park Min-shik for the Korean Times, November 18, 2010.

Lucy P. Marcus

A glaring lack of female directors on a company’s board of directors is a sign that it is not a “healthy business,’’ according to Lucy P. Marcus, founder and chief executive officer of Marcus Venture Capital.

Many Asian and Korean corporations have little or no female representatives in boardrooms, but Marcus says this is sadly still an all too common case on corporate boards around the world.

“There is no doubt that women are severely under-represented in the boardroom, and this is not only the case in Asia, but all over the world. The lack of women on boards, however, is a reflection of a wider problem with diversity: it is one of color, age, international perspective, and more,’’ Marcus said in an interview with the Hankook Ilbo, a sister paper of The Korea Times.

Marcus, whose company works with venture capital and private equity funds, institutions and corporations, said that as an investor, the lack of diversity in a corporate board sets her alarm bells ringing.

“When I see a business with a board that has a preponderance of people with similar, if not identical, profiles, this is a signal that it is not a healthy business… Its good corporate governance and good business sense to reflect a range of the organization’s stakeholders,’’ she said.

Data shows the percentage of women board directors in Asia is only 1.8 percent, compared to 20.5 percent in Nordic countries and 14.1 percent in North America. Marcus noted that having diversity results in a more capable and better functioning board that is better equipped to deal with various challenges.

“Healthy businesses need comprehensive diversity. Without it, there is no independence of thought or action, and no way to keep in touch with the pulse of the stakeholders of today,’’ she added.

Marcus is one of the keynote speakers at the 2010 Seoul Global Women’s Leadership Conference to be held on Nov. 29 and 30 at the Shilla Hotel, Seoul.

In her project “The Global Task Force on Building Women Leaders,” one of the premises is: “There is a widely recognized need to strengthen leadership roles for women in government, and in non-governmental and corporate organizations around the world. There is a pressing desire to address this need in a comprehensive and concrete manner.”

Marcus once again emphasized the importance of creating an environment where women can succeed. Some countries may require special efforts, whether through legislative measures or economic incentives, such as rewarding workplaces for encouraging women and educational systems that educate women to the highest standards. (continue reading!)


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(in Portuguese) A weekly chronicle about shareholders' rights & duties, activism and capital markets regulation, by Renato Chaves.
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