The long, public battle between Sovereign Bancorp and its largest shareholders over whom, and how, to appoint to the bank’s board of directors to decide a $2.4 billion merger has finally ended. Sovereign and Relational Investors signed a surprising settlement last week, just days before the two were to appear in federal court again sparring […]
Stephen Taub
Posted inBoards & Shareholders
Despite Setbacks, Majority Vote Pushes On
The majority vote movement rolling across Corporate America hit a few bumps last week as Hewlett-Packard and two other corporations rejected the idea at annual meetings, but governance watchdogs say the reform will continue to spread this proxy season. HP’s non-binding resolution to impose a majority vote requirement for election to its board of directors […]
Posted inBoards & Shareholders
CEO Succession: Unspoken, Unmet Board Need
On March 1, the directors of Clorox received grim news both personal and professional: The company’s chairman and chief executive, Gerald Johnston, had suffered a heart attack. EXCERPT The excerpt below is from the March 7, 2006, Clorox announcement. Emphasis added: Johnston The Clorox Company today announced that Chairman and Chief Executive Officer Gerald “Jerry” […]
Posted inRegulatory Enforcement
Nortel Latest To Improve Governance In Suit
Virtue may be its own reward—but just to be safe, shareholders of Nortel Networks squeezed it into a $2.5 billion lawsuit settlement anyway. When Nortel announced last month that it agreed to pay nearly $2.5 billion in cash and stock to resolve investor claims stemming from three years of restated financial results in the early […]
Posted inFrom the Archive
On Wall Street, Compliance Costs Soaring
The securities industry last week complained that compliance costs on Wall Street have nearly doubled in the past three years to more than $25 billion—largely because of duplicate or inconsistent regulatory schemes that could be avoided. According to a report from the Securities Industry Association, compliance costs have surged from $13 billion in 2002, and […]
Posted inBoards & Shareholders
Promises Broken, Shareholders Sue Murdoch
Playing with poison can be a dangerous thing. So, it seems, can be playing with a company’s promises to shareholders. News Corp. has suffered a winter of discontent with its shareholders, as the two sides argued in court about whether the company could renege on a 2004 promise not to adopt a poison pill. Rupert […]
Posted inBoards & Shareholders
Intel Takes The Lead In Majority Vote Debate
Is Intel suddenly setting the standard for setting a majority standard for approving directors? The microchip giant made headlines Jan. 19 with the announcement that it had amended company by-laws to adopt a majority-vote requirement for directors in uncontested elections. When directors fail to win a majority, they must submit their resignations to the board […]
Posted inFrom the Archive
Pepsi Execs Miss Goals, Performance Stock Yanked
Pepsi Bottling Group has seen some pretty flat share activity in the last year, with prices puttering between $26 and $30. So it should come as little surprise that the company took the fizz out of executives’ compensation this year, too. Pepsi Bottling’s directors decided earlier this month against awarding performance-based restricted stock awards, since […]
Posted inBoards & Shareholders
Pension Funds And Hedge Funds Increasingly At Odds
Though executives and the media typically group hedge funds and pension funds into a single class of “institutional investors,” there’s increasing evidence that the two fund types are at odds. In recent conversations with Compliance Week, a number of pension- and union-fund managers admit they are uneasy with many of the tactics and goals of […]
Posted inBoards & Shareholders
Hedge Fund’s No-Pain Gambit Draws SEC Eye
The Securities and Exchange Commission is raising eyebrows on Wall Street with an investigation into a $10 billion hedge fund that tried to dodge the old adage of “no pain, no gain” in a failed drug-industry merger. At issue are the elaborate financial maneuverings of the Perry Capital hedge fund, as it tried to straddle […]