What makes board directors and top executives from 19 leading Latin American companies carve out two or three days from their busy schedules—every year?

The Latin American Companies Circle held its sixth annual meeting in November in Lima, Peru. Participants reviewed two draft reports (on annual general meeting practices and on board evaluations), discussed case studies of good-practice corporate governance reforms by its members, and set the 2012 agenda.

The Companies Circle is an initiative of the Latin American Roundtable and is supported by IFC, the OECD, and the Forum. Established in 2005, it quickly earned a reputation as one of the region’s most vibrant and effective advocates for good corporate governance. The Companies Circle provides private sector input into the work of the Roundtable and, increasingly more important, a forum where directors and top executives can frankly discuss corporate governance issues of common concern and share practical solutions.

“What makes the Companies Circle unique is the sharing of experiences by its members with one another but also with companies throughout Latin America,” says… (continue reading)

Philip Armstrong, Head of the Global Corporate Governance Forum, speaks about CSR around the world, and emerging trends. IE Business School video.

Download the Private Sector Opinion #24 by Michel Doucin (pdf). Foreword by Olivier Maurel.

Pour lire la version française du texte, veuillez cliquer ici.

On the other hand, we still talk and communicate on #corpgov issues through Twitter at the @CorpGovLeaders account (Follow us!) and our LinkedIn group is very active.

We invite you then to continue reading…

IGCLA Book in Spanish

Since 2009, eleven corporate governance institutes in Latin America have exchanged experiences and knowledge on corporate governance. This publication provides an updated scenario of corporate governance in Latin America, the latest developments, projects and future perspectives,  under the particular look of each member of IGCLA. (download the book in Spanish here!)

Desde el año 2009 varios institutos de gobierno corporativo de Latinoamérica se han reunido e intercambiado experiencias y conocimientos sobre gobierno corporativo. Es así como esta publicación ofrece un escenario actualizado en materia de gobierno corporativo en América Latina, los últimos desarrollos, proyectos y futuras perspectivas, bajo la particular mirada de cada miembro del IGCLA. (lea el libro aqui!)

It began normally enough, with a discussion of alignment of interests between executives and shareowners, role of a Board’s compensation committee, disclosure of compensation, etc.   However, I decided to ask what I thought was going to be an ineffectual verbal challenge.

Why, I asked, do institutional investors keep preaching alignment?  We’ve been doing that for two generations and it has not worked. Perhaps it’s time to admit the obvious: Shareowners’ interests and executives’ are not perfectly aligned and cannot be made to be perfectly aligned. Perhaps it’s time to admit that fact and return to an old idea: Management, even senior management, are employees. They ought to be fairly – and I’d say even generously compensated – but they are employees of the corporation not suppliers of capital. Is it simply time to stop trying for alignment and deal with them as highly-compensated employees for whom the board must make a compensation decision, whether in cash, shares, options or whatever.  But that means the Board must consider what has become know in Europe as “quantum,” which is shorthand for both “what do all the various compensation schemes add up to” and “how much is enough”.  It does not include, however whether options or restricted shares or phantom shares or time-vested grants or performance-grants or deferred comp or three-year vesting rights or any of the other “comp speak” we’ve all come to know far too well over the years.  In some ways, by considering the mechanisms of pay, and trying to make them aligned, we’ve emphasized form over substance, and the amount has become a fall-out, rather than a decision… (continue reading)

Santiago Chaher & award winning Stephen Davis

At the ICGN Annual Conference 2011 (#ICGN11) in Paris Santiago Chaher from @CorpGovLeaders and Eric Jackson encouraged the audience to discuss the growing influence of Social Media in governance practices and shareholder activism. The following questions were then asked to the audience:

(1) How are social media changing the behavior of institutional investors–both in respect of value creation and in relationships with beneficiaries?

(2) How can corporate boards adapt to risks and opportunities posed by social media?

(3) How are social media affecting the behavior and influence of stakeholders in relation to companies and investors?

The session was live tweeted and you can see the story line here or just look for the hashtag #SMCG.

What are your thoughts? We would like to continue the conversation! Thanks