Tag Archives: shareholders

What to do With Proxies That You Get in the Mail

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By Sheyna Steiner,

On the bankrate website, Sheyna Steiner deals about the next question :
Why your proxy vote matters in proxy season?

“ Proxy season may be winding down, but next year’s voting season will be here sooner than you realize. If you’re at all interested in influencing corporate governance, then learn the ins and outs of proxy voting before your company’s meeting or before next year’s ballots arrive in the spring.

For small-time owners of common stock in companies, it can be easy to discount the importance of participating in corporate governance. Why should management at Exxon Mobil Corp. care about the votes from a shareholder with a measly 100 shares, for instance? But adding your voice to those of other shareholders, big and small, can get attention and influence the decisions of the board of directors, the management and the social and environmental direction of the company.

What is a Proxy? Why Do You Vote It?

Before the annual shareholder meeting, packets of information containing the proxy statement are sent to all shareholders. The proxy statement contains information about the topics to be covered at the annual meeting, including nominations for the board of directors and the pay packages of the top five executives. There are also proposals from management as well as shareholder proposals.

Also included in the mailing is background information on the issues.

The shareholder then fills out the proxy ballot, also known as a voting instruction form, and sends it back.

Alternatively, shareholders can vote by phone or over the Internet.

The various issues up for a vote every year receive different treatment from management. For instance, while the votes for directors on the board are binding, the say on pay vote and those on shareholder resolutions are considered advisory.

For the advisory votes, “there’s nothing legally binding where the company has to make a change. But even if there are just 20% of shareholders who voted in favor of a certain initiative, that’s a lot. When a portion of your shareholders get together in support of an issue, that warrants discussion at least,” says Jessica Clarke, advocate relationship manager at Moxy Vote, a proxy voting research firm.”

The author continue the analyse with the shareholder initiatives and their power over decisions

Shareholder initiatives

“Anyone who owns $2,000 worth of a company’s stock for one year can submit shareholder resolutions to be voted on at the shareholder meeting. Shareholder initiatives span many different environmental, social or governance issues.

Like most investment mailings, proxy voting materials tend to be complex and a little esoteric. In most cases, the nominations for the board of directors are not particularly well-known people, and the other issues up for a vote can also require some research…”

Read the full article on the bankrate website

Corporate Governance and the Problem of Executive Compensation

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By J Robert Brown Jr

“Corporate governance is one of those topics that only seems to grow in importance.  Some of the importance comes from increased organization of shareholders. 
The public has also become increasingly aware of these sort of issues.  What was once a matter betwen managers and owners has now become an issue debate within the public at large.”  

J Robert Brown in .theracetothebottom.org website, author of this article deals about the issues of executive compensation.

Compensation issues raise questions about the role of the board of directors. For public companies traded on a stock exchange, there must be at least a majority of independent directors.  In fact, the largest public companies typically have a super majorityof independent directors.  Yet this structure has been unable to stop a steady increase in the amount of compensation, the payment of unnecessary perqs, and, until say on pay, a not uncommon disconnect between pay and performance.  Nor has the structure stopped an escalation in director compensation.

This is one of those areas where the problem is clear, the source obvious, and the solution straightforward.  State law determines the obligations of the board, including those connected to the approval of executive compensation.  State courts, particularly those in Delaware, have adopted standards that impose no meaningful limits on executive compensation.  This phenomena is discussed at length in Returning Fairness to Executive Compensation.

The Solution ?
Read the article on Theracetothebottom.org

 

First Key to Agile IT Governance: Stakeholder Satisfaction

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By Chiranjeev Bordoloi

The website CIO started a serie called The 12 Principles of Agile IT Governance.
The series is designed to help board members and senior managers leverage technology excellence as a competitive advantage for their organization. Each article discusses a key principle of agile IT governance and presents tactical measures that allow for deployment of that principle.

This interesting series accurate that 4 steps are necessary to focus on Stakeholders  satisfaction :

1- Manage shareholder satisfaction with ROI on technology investments.

2- Improve management’s technology quotient.

3- Ensure that employees feel like they work for a tech-savvy company.

4- Actively contribute to open source projects and organizing hackathons to improve   the company’s brand perception in the community.

 

Read More: CIO website 

 

Apple shareholders face California conundrum

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This article is an extract from The Wall Street Journal:

“Call it the California conundrum.

It’s the reason Apple’s board of directors did not act on a straightforward and nonbinding proposal favored last year by about 74% of the company’s shareholders.

Now, the same issue will be back in front of Apple shareholders at the company’s Feb. 23 annual meeting. And the conundrum, unfortunately, is still around.

Here’s the story. The big public pension fund and influential investor known as CalPERS (the California Public Employees’ Retirement System) wants Apple to adopt what it says more than 80% of S&P 500 companies already have adopted: majority voting for directors in uncontested elections.

This is a key governance issue. It used to be that most companies (as Apple still does) used what’s called a “plurality” system for choosing directors when there’s only one candidate. In reality, plurality means one “for” vote gets a director re-elected, no matter how many unhappy shareholders “withhold” their votes.

“Majority” voting pretty much delivers what it implies and should make sense to anyone with an understanding of what the word election means. With various caveats, it means directors at many U.S. public companies need to garner more “for” votes than “withhold” votes to keep their seats at boardroom  tables…”

To read the full article: The Wall Street Journal



Toward Effective Governance of Financial Institutions

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“Drawing lessons from the financial crisis, the G30 calls on boards of directors of financial institutions to do far more to strengthen governance. The report stresses that values influence the behavior of those with governance responsibilities and the key to reform is to promote changes in the ways in which these individuals think about their responsibilities.”

Toward effective governance of financial institutions

2011 Board Practices Report – Deloitte

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This report by the Deloitte Center for Corporate Governance and the Society of Corporate Secretaries and Governance Professionals provides results from a survey of over 200 corporate secretaries on topical governance questions, including shareholder engagement, board committees, strategy, and sustainability. New to this eighth edition is an analysis of director qualifications, which includes insight on board composition related to gender, age, and ethnicity…

2011 Board Pracices Report by Deloitte


Sudden Death of a Ceo : Death and Succession planning

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Sudden Death of a Ceo : Death and Succession planning 

By Professor, David F. Larcker and Brian Tayan, Researcher, Corporate Governance Research Program, Stanford Graduate School of Business

It is very difficult for shareholders to know detailed information about CEO succession planning among the companies they have invested in.  Although CEO deaths are rare, the sudden death of a CEO can provide insight into the quality of succession planning and governance of a company.  Whereas some companies are able to appoint a successor immediately, others take weeks or months to do so.