Based on a proposal discussed in a recent issue of the Stanford Law Review, this recent Economist article promotes outsourcing corporate boards as a solution to corporate governance failures of the type we have experienced historically. As proposed, outsourcing would consist of replacing individual directors with a new category of professional firms – identified as BSPs or Board Service Providers – that companies would retain to supply them with a “full complement of board members.” The article claims that, despite some reforms over the past decade, boards are (still) fundamentally flawed. Specifically, here is how the article characterizes boards: Continue Reading →
Tag Archives | board
Those were the opening sentences of another excellent editorial at Pensions & Investments (Test of Governance Wills, June 30). See their cartoon at right, which is very close to portraying the truth about Nabors. (P&I’s other outstanding recent editorial was Winning over proxy voters, May 12.) Continue Reading →
A Hong-Kong based venture capital fund has appointed artificial intelligence to its board of directors. Robot directors? Friday’s video is a fun response to this publicity stunt from governance expert Lucy Marcus.
The California Public Employees’ Retirement System (CalPERS) is conducting two elections this fall for the State and public agency representative seats on the CalPERS Board of Administration. Current terms for both positions end in January 2015. The election for the school board member representative seat will not be conducted because the incumbent, Rob Feckner, was unopposed. George Diehr, Ph.D., the incumbent in the State member position announced he would not seek reelection.
ITC Holdings $ITC, is one of the stocks in my portfolio. Their annual meeting is coming up on 5/21/2014. ProxyDemocracy.org had collected the votes of no funds when I checked and voted on 5/15/2014. I voted with management 50% of the time. View Proxy Statement. Read Warnings below. My proxy voting recommendations follow. Continue Reading →
The March/April edition of The Corporate Board contains several excellent articles. I e-mailed a couple of quotes from their ‘Spoken & Written’ section to a CEO who needs a real board, instead of a rubber stamp. Continue Reading →
EMC Corporation $EMC is one of the stocks in my portfolio. Their annual meeting is coming up on 4/30/2014. ProxyDemocracy.org had collected the votes of four funds when I checked and voted on 4/22/2014. I voted with management 13% of the time. View EMC’s Proxy Statement, which is user friendly. Continue Reading →
Corporate boards are exceeding legal oversight requirements on environmental and social issues, with more than half of S&P 500 companies providing board level oversight of environmental and/or social issues above and beyond that required by law. Board Oversight of Sustainability Issues finds that many industries subject to scrutiny – paper, forestry, healthcare, utility companies – are among the most likely to have board oversight of sustainability issues. But, the retail sector lags despite criticism for recycling and labor and human rights practices. Continue Reading →
Apple Inc. (NASD:AAPL) is one of the stocks in my portfolio. Their annual meeting is coming up on 2/28/2014. ProxyDemocracy.org was down for maintenance when I checked and voted on 2/19/2014, so no voting advice there. I checked a few other sources such as CalPERS, Florida SBA and OTPP but none had disclosed their votes on their sites as of yesterday. I voted with 89% of the Board’s recommendations. View Apple’s Proxy Statement. Continue Reading →
Below are notes I took during the afternoon sessions at the Corporate Directors Forum 2014, held on the beautiful campus of the University of San Diego, January 26-28, 2014. This year, I was only able to attend on January 27th. The program was subject to the Chatham House Rule, so there will be little in the way of attribution below but I hope to provide some sense of the discussion.
If you are a director or candidate, investor, senior corporate officer, board or management advisor, academic, or are in some way part of the corporate governance industrial complex or want to be, I hope to see you there January 25-27, 2015. If you attended the Forum this year and have ideas for articles you would like to see or to write for CorpGov.net, please email me your ideas or drafts. Part 1. Continue Reading →
Despite the Apple Board’s best effort to obtain a “no-action” letter to exclude my proxy access proposal, it is included among the items to be voted on at or before the annual meeting to be held on February 28 at our Company’s principal executive offices in Cupertino, CA. See Apple’s proxy, Proxy Proposal 11, ‘Proxy Access for Shareholders’ on page 63. (A minor gripe – why doesn’t Apple provide a linked index to our proxy so that shareholders can easily flip to the subject they are looking for? Let’s hope part of their strategy isn’t making it too hard to analyze the issues and vote.)
Here’s the thrust of my argument. We need directors who can address the big money pile – not with short-term buyback strategies that facilitate extraction of value but with long-term strategies that create value. Investing $150B in Treasuries or money markets is not efficient use of our money. The returns of Google Ventures, for example, are far above the industry’s mean. There is no reason why Apple couldn’t also put our money to good use though an Apple Ventures type of vehicle or through a revamped and enhanced Blue Sky program. Continue Reading →
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 →
My 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 →
In mid-July I e-mailed investor relations at Reeds Inc. $REED (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 →
Should boards reexamine stock buybacks? That was the subject addressed by a distinguished panel during a recent SVDX program hosted at Stanford’s Rock Center for Corporate Governance. What follows is the SVDX meeting pitch, with issues and brief bios, followed by a few of my observations at the event. Watch the video wrap-up (below) from WMS media Inc.
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