Technology at the Top, the Changes Made in the Boardroom

Amanda-Biggs

Amanda Biggs

Guest post from Amanda Biggs, web manager and governance writer. By participating in the expansion of the Leading Boards portal for boards of directors, she has specialized on issues concerning the arrival of technology inside the boardroom.

All through the last decade new technology solutions and tools have moved from being non-existent to becoming a “must have” for many directors worldwide. Indeed, research and development led to “board portals” which are adapted to the boardrooms’ needs and have become be necessary for the modern challenges that boards face concerning workflow and management. The advent of the iPad with its mobile Continue Reading →

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SEC-IAC to Meet January 31st

SECThe Securities and Exchange Commission Investor Advisory Committee (SEC-IAC), established pursuant to Section 911 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, will hold a public meeting on Friday, January 31, 2014, in Multi-Purpose Room LL-006 at SEC headquarters, 100 F Street, NE, Washington, DC 20549. The meeting will begin at 10:00 a.m. (EDT) and end at 4:30 p.m. and will be open to the public, except during portions of the meeting reserved for meetings of the Committee’s subcommittees.
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Review: Handbook of Research on Promoting Women’s Careers

The march of women into the upper echelon seems inevitable. A few points from the introduction:HandbookOfResearchOnPromotingWomensCareers

  • 60% of recent university graduates have been women, 50% of those graduating with advanced degrees in law and medicine, 1/3 of those with MBAs.
  • There will be labor and skill shortages in all developed countries over the next two decades as baby-boomers retire.
  • Women make 89% of the consumer purchasing decisions.
  • Companies with more women in top management positions are more successful.
  • Women are less greedy, less likely to engage in theft, fraud and corruption, protecting their organizations from failure and poor reputation.
  • Organizations retaining and advancing qualified women have an advantage in the war for talent. Continue Reading →
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Investing in Women & Inalienable Rights: Part II

Yesterday, in Part I, I discussed the most recent UC Davis Study of California Women Business Leaders: A Census of Women Directors and Executive Officers and how it led me to invest disproportionately in firms with more women CEOs and NEOs. Just how are women different than men and what kind of changes can we expect or hope for?

More Evidence Women Leaders Make Difference

And there is this from a recent article in The Economist (Vive la différence!, 12/7/2013): Men&WomenBrainWiring

MEN and women do not think in the same ways. Few would disagree with that. And science has quantified some of those differences. Men, it is pretty well established, have better motor and spatial abilities than women, and more monomaniacal patterns of thought. Women have better memories, are more socially adept, and are better at dealing with several things at once. There is a lot of overlap, obviously. But on average these observations are true…

the cross-talk between them in women, suggested by the wiring diagrams, helps explain their better memories, social adeptness and ability to multitask, all of which benefit from the hemispheres collaborating. In men, by contrast, within-hemisphere links let them focus on things that do not need complex inputs from both hemispheres. Continue Reading →

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Investing in Women & Inalienable Rights: Part I

UCDstudyCAWomenBusinessLeadersSince starting this blog in 1995, I’ve pushed for greater diversity on boards and in named executive officers (NEOs). Progress has proceeded at a glacial pace, at least in the United States. For the ninth year, the UC Davis Graduate School of Management, in partnership with Watermark, published the annual UC Davis Study of California Women Business Leaders: A Census of Women Directors and Executive Officers. The study found the average Top 25 firms (which have 25+% women at upper levels) makes three times as much revenue and almost 50% more net income than the average company in the study (which has 10.9% women).

After reading the study, I took the plunge, investing in seven of the top 25 California companies with the highest percentage of women leaders. Hopefully, investing in women will reap additional rewards and will help me carry on with my efforts to make corporate governance more democratic. Women obviously bring a different perspective that pays financial dividends. Will women in positions of power also result in a more salubrious environment, recognition of human rights and a more equitable distribution of wealth?

I invested in the following: Annie’s (BNNY), Medivation (MDVN), Genomic Health (GHDX), Bio-Rad Laboratories (BIO), NETGEAR (NTGR), Symantec (SYMC), and Visa (V). I’ve been trying to invest in Yahoo! (YHOO) and SciClone Pharmaceuticals (SCLN) but haven’t been successful at the prices I’ve bid. I already had investments in Walt Disney (DIS). See all my investments under Disclosures. Continue Reading →

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Take Action: Support CII Rulemaking Petition for “Universal” Proxy

CII-logoThe Council of Institutional Investors (CII) filed a rulemaking petition with the Securities and Exchange Commission (SEC) asking that it amend its rules for contested elections so that “shareholders can vote for any combination of management and dissident nominees they wish to represent them.”  I hope readers will join with me in sending e-mails in support of the petition to the SEC.  Instructions on how to do so can be found at the bottom of this post. 

This petition is a followup to action they took on July 23, 2013 when the Policies Committee of CII approved a draft proposal for a Universal Proxy. Key, was addition of the following sentence to their policy on director elections:

To facilitate the shareholder voting franchise, the opposing sides engaged in a contested election should utilize a proxy card naming all management-nominees and all shareholder-proponent nominees, providing every nominee equal prominence on the proxy card.  Continue Reading →

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Video Friday: Board Assessment

Leblanc

Dr. Richard Leblanc

Dr. Richard Leblanc created this week’s video to discuss his board assessment tool that addresses a key deficiency in corporate governance: namely the review of board and individual director performance. Surveys show that many or most boards of directors self-review their own performance, and possibly the performance of individual directors, or do not do so at all. Management often unduly influences and facilitates internal board reviews, setting and managing questions and data, and Continue Reading →

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Quick Bites on CorpGov

UnknownDon’t miss the following great reads:

 Activist shareholders’ top priorities for 2014. A must read for directors and shareowners alike. Here’s the first paragraph.

Many of us free ride on actions taken by active, long-term shareholders. These unsung heroes goad managers and boards to reach better decisions, make available desirable employment opportunities and, overall, push them to act like good corporate citizens. These active investors accomplish these things by talking to companies, preparing proxy proposals for all shareholders to consider, and offering recommendations on director elections and company-sponsored proxy measures.

Ralph Ward digs past the standard bullshit in his 2014 Boardroom Insider. Always plenty to chew on in a few short pages. Here’s a tidbit, which I hope will leave you wanting more, which includes more tips than you’ll find in pages and pages of other publications aimed at directors. Continue Reading →

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Gender Diversity: ICGN’s Position

ICGNThe International Corporate Governance Network sent comments to the Ontario Securities Commission (OSC) and the Australian Stock Exchange (ASX). I think they warrant widespread reading and adoption. What follows are highlights from the OSC letter.

Gender diversity is a competitiveness issue for a company as a whole and a critical dimension of governance, both in the board’s oversight of the enterprise and in the board’s own composition and talent management. Increasing the representation of skilled and competent women on corporate boards will strengthen the corporate governance culture and ultimately contribute to value for all stakeholders. Continue Reading →

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Reeds Inc (REED): Examining The Vote

ReedsTshirt1

Reeds Hippie T-Shirt

ReedsRedAs some readers noted, I put in more effort at Reeds Inc. (REED) than at many of my other holdings, proposing proxy access and writing about the problems at Reeds four times before the annual meeting, even doing a short video.

My rationale is that while I am a small shareowner at both Apple and Reeds, for example, my proportionate share at Reeds is much larger. So, focusing more on Reeds makes sense for me personally. In addition, while other companies in my portfolio get plenty of attention from the financial press and often from other shareowner activists, Reeds does not. Additionally, although Reeds has great products, it is far from reaching its full potential.

I recommended against directors Muffoletto and Fischman because they own no shares, for a say-on-pay frequency of once each year to ensure annual accountability and, of course, I favored my own proxy access proposal to give shareowners a stronger voice going forward. Glancing at the 8-K report filed by Reeds after the AGM, you might think shareowners were in complete agreement with management. However, further analysis reveals otherwise. Continue Reading →

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Job: General Counsel at CalPERS

CalPERS-logoCalPERS is still recruiting to fill its vacant General Counsel position.  This is an exciting opportunity for a visionary in the legal profession to play a key role in a preeminent public pension fund.  Under the direction of the Chief Executive Officer, the General Counsel supports CalPERS in the management of a global portfolio of more than $270 billion, as well as complex financial and actuarial functions. The position is based in Sacramento, California. Continue Reading →

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Job: Environmental, Social & Governance (ESG) Proxy Research Associate – San Francisco

GlassLewisAs a member of Glass Lewis’ Environmental, Social & Governance Proxy Paper research team, you will analyze company filings, summarize their proposals, and offer voting recommendations to our clients–some of which include the world’s largest institutional investors. This is an excellent opportunity to learn about the intricacies of the corporate structure, to research publicly-traded companies and how they are affected by sustainability-related issues and to work at the forefront of the emerging environmental, social & governance field. This will be a particularly valuable experience for those wishing to pursue careers or graduate study in law, business, and public policy, among others. Continue Reading →

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Video Friday: Are Corporate Governance Standards Different for Smaller Firms?

MarkkulaCenterKirk O. Hanson, executive director of The Markkula Center for Applied Ethics, interviews John W. Noble, vice chancellor, Delaware Court of Chancery. Are there different ethical standards depending on the size of the company, and also for entrepreneurial ventures? What about a new company vs an established one? Noble responds: directors must act in an informed way and uphold the needs of the company and its shareholders first and foremost. Directors must keep these principles in mind, whatever the size of the company. But fiduciary responsibilities do vary according to the size of the enterprise. A larger enterprise can do things a smaller one can’t. But the bottom line is directors’ compliance. Continue Reading →

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BNY Mellon & PNC Asked to Drop Lockout Meeting Policies: Take Action

BNYFriends Fiduciary (FFC) took the lead advocate role in sending letters to BNY Mellon and PNC expressing concern over virtual-only shareholder meetings. Virtual-only shareholder meetings are widely criticized for limiting shareholder participation, and bylaw amendments by BNY Mellon and PNC signaled their intent to conduct virtual shareholder meetings exclusively. Continue Reading →

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Video Friday: The Cadbury Archive

Cambridge0judge-logoThe Cadbury Archive at Cambridge Judge Business School has been completed with the addition of copies of all the speeches on corporate governance made by Sir Adrian Cadbury, Chairman of the UK Committee on the Financial Aspects of Corporate Governance. The Archive, established in 2010 and part of the Cambridge Corporate Governance Network (CCGN), is a major source for researchers into corporate governance. Continue Reading →

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Mediant Opens New Fulfillment Center

mediant_logoMediant Communications, a provider of investor communications services and technology to banks, broker-dealers, mutual funds and corporations, today announced the opening of its new print-and-mail fulfillment center in Wayne, NJ.  The new facility enables the company to service the expanding needs and diversity of its growing customer base. Continue Reading →

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IRRCi 5 Year Impact Report, Accepting Research Award Submissions

IRRCi-5yrImpactSince issuing their first report in 2009, the Investor Responsibility Research Center Institute has made a deep impact – far beyond their expectations. A new Five Year Impact Report recaps the 28 reports IRRCi has issued, which cover a wide range of contentious issues – executive compensation, fracking, political spending and proxy voting – to name a few.  Since founding, they have remained passionate that all their research is objective and unbiased.  As a result, the research has become a valuable tool for investors, policymakers, and other stakeholders. Continue Reading →

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Shareholder Primacy: Paradigm or GroupThink

PeterTunjicGuest post from Peter Tunjic – Commercial lawyer, idea inventor, framework builder, business designer, board advisor and advocate and defender of free corporations. Peter writes at On Directorship and is “re-inventing the boardroom from capitalism’s forgotten first principles.” Thanks to Peter for permission to republish his following thought provoking post. Comments are always welcome but must come to me by e-mail so I can filter out the spam. 

Shareholder primacy is a norm of corporate governance that requires the allegiance of a corporation’s board of directors to the single objective of shareholder wealth maximization.   To think otherwise is considered a form of “corporate deviance.” Continue Reading →

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Last Opportunity to Vote for Proxy Access at Reeds Inc. (REED)

ReedsRedReeds, Inc $REED; you read the Proxy, the crazy Preliminary Proxy, and the rationale for proxy access. You’ve seen the movie, where I  explained the need for proxy access Now, don’t forget to vote! The annual meeting is December 20, 2013.  According to ProxyVote.com, Internet voting is accepted up to 11:59 p.m. (ET) the day before the meeting/cut off date. That’s Thursday! Below are my proxy recommendations.  Continue Reading →

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WD-40 Seeks Director of Investor Relations & Corporate Communication

WD-40WD-40 $WDFC is seeking a passionate and driven Director of Investor Relations & Corporate Communication who brings to the table broad and deep experience in finance and corporate communication engaging the investment community with confidence and poise. The position manages the entire quarterly earnings process including logistics, preparation of press releases, presentations, scripts, Q&A, supplementary schedules, and follow-up calls with institutional analysts and stockholders.  Continue Reading →

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Best Coverage of SEC Proxy Advisory Services Roundtable

theracetothebottomTheRacetotheBottom has by far the best coverage I’ve seen on the SEC’s roundtable. Congratulations. Those interested in the tweet stream during the event can check out Proxy Advisory Services Roundtable: Tweets & Links to Analysis.

Of course, there was no one invited to the Roundtable to represent the interests of retail investors… left out again. My biggest disappointment is that no one mentioned the possibility of proxy advisor contests, such as what I proposed at Cisco. See Cisco: How Our Proxy Competition Would Work – The Short VersionContinue Reading →

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Video Friday: Vote “For” Proxy Access at Reeds Inc. (REED)

REEDGojiGinger_KombuchaMy first effort to record a video on corporate governance is about my proxy access proposal, now being voted on at Reeds Inc. (REED).  The video below explains Reeds’ great potential and why I submitted a 2013 shareholder proposal to allow shareholders proxy access for up to two director nominees.

Did you know 40% of our Board members own NO stock in our company or that directors are expected to show up for 10 Board meetings a year (plus various committee meetings) but are paid as little as $750 for their service? For that kind of work, with such little financial reward, what is their motive? Are they really Continue Reading →

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United Natural Foods (UNFI): How I Voted – Proxy Score 75

unfi-logoUnited Natural Foods, Inc. $UNFI is one of the stocks in my portfolio. Their annual meeting is coming up on 12/18/2013. ProxyDemocracy.org had collected the votes of four funds when I checked and voted on 12/11/2013.  I voted with management 75% of the time.  View Proxy Statement.

Warning: Be sure to vote each item on the proxy. Any items left blank are voted in favor of management’s recommendations. (See Broken Windows & Proxy Vote Rigging – Both Invite More Serious Crime) Continue Reading →

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Using Sharegate: The Next Great Shareholder Communications Platform

sharegateOne way to use Sharegate is to announce your proxy votes. Far too many retail shareowners just trash their proxies instead of using them. A common misconception is that shareowners should take the Wall Street Walk and sell if they are displeased with any aspect of a company they own. That is like saying you should pack up and move out of the neighborhood if you think there should be a stop sign at the end of the block.  Continue Reading →

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Is Wall Street Capitalism Really “The Model”?

DavidEllerman

David P. Ellerman

Guest post from David P. Ellerman who works in the fields of economics and political economy, social theory and philosophy, mathematical logic, and quantum mechanics. His undergraduate degree was in philosophy at M.I.T. (’65), and he has Masters degrees in Philosophy of Science (’67) and in Economics (’68), and a doctorate in Mathematics (’71) all from Boston University. He has been in and out of teaching in economics, mathematics, accounting, computer science, and operations research departments in various universities (1970-90), founded and managed a consulting firm in East Europe (1990-2), and worked in the World Bank from 1992 to 2003 where he was an economic advisor to the Chief Economist (Joseph Stiglitz). He is currently a visiting scholar at the University of California/Riverside and a Fellow of the Center on Global Justice at University of California/San Diego.

He has published numerous articles in various fields and five books. The published and draft papers and book manuscripts, including Is Wall Street Capitalism Really “The Model,  are available on his website, David Ellerman. See also his working papers here on the SSRN site. Continue Reading →

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New Managing Director at ICGN

ICGNThe International Corporate Governance Network (ICGN)  announced that Kerrie Waring has been appointed as its new Managing Director following an international search over three months. The ICGN is the leading investor-led organisation of governance professionals, with members in over 50 countries, including institutional investors responsible for US$18 trillion in global assets. Continue Reading →

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Reeds Inc. (REED): The Case for Proxy Access & How I Voted

ReedsIn mid-July I e-mailed investor relations at Reeds Inc. $REEDGojiGinger_Kombucha (IR@reedsinc.com) asking if REED had a classified board or plurality requirements for director elections. Can shareowners call a special meeting or act by written consent? What supermajority requirements are in place re M&A or other actions? No response. This surprised and disappointed me since they were prompt in answering previous e-mails: Make kombucha; we’re already working on it. Try one with coconut water and ginger; good idea. Where can I find Reeds Kombucha in Sacramento?; here’s a list.

According to FactSet Research Systems, “insider/stake ownership” at REED is 33.5% of the company’s float. Being almost a controlled company, maybe they don’t feel the need to respond to inquiries from ‘outside’ shareowners about the firm’s corporate governance.  They not only didn’t answer me, they blocked me from following their Twitter feed. Maybe management and the current board think the less outside shareowners know, the better for them? Continue Reading →

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Video Friday: Jon Lukomnik on Executive Compensation and Short-termism

LukomnikTK Kerstetter, Chairman, NYSE Governance Services / Corporate Board Member interviews one of the brightest minds in corporate governance, Jon Lukomnik, who serves as the executive director of the IRRC Institute. A columnist for Compliance Week, Mr. Lukomnik previously chaired the executive committee of the Council of Institutional Investors, co-founded and served as a governor of the International Corporate Governance Network and is co-author of the award-winning The New Capitalists: How Citizen Investors Are Reshaping the Corporate Agenda (Harvard Business School Press, 2006). Download Creating Responsible Financial Markets. Continue Reading →

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Proxy Advisory Services Roundtable: Tweets & Links to Analysis

SECNo time to synthesize or comment but following are tweets I gathered from SEC’s Proxy Advisory Services Roundtable. Sorry for one bit of profanity, several possible misinterpretations, wiping out a few tweets in cleanup process and poor formatting.

Links to analysis by others:

I hope they don’t do anything to stifle the possibility of proxy contests. See my comments to the SEC on this issue. Continue Reading →

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