Boards & Shareholders

Life is hard for hedge funds these days. The industry grew up making money on carry trades, arbitrage and relative value plays. But current market conditions—a flat yield curve, tight credit spreads and low volatility—and the sheer volume of money now sloshing around in hedge funds has squeezed returns across the board. Weingarten “It’s hard […]

Pick your caricature: Activist owners are greedy short-term players willing to destroy the company long-term in return for a short-term stock price jump. Executives are entrenched management, protected from the downside of their flawed decisions, but reaping the upside when their stock options kick in because of short-term earnings management. Intriguingly, the only trait those […]

Spring is in the air, and so the 2006 annual meeting season gets underway—with executive compensation and majority voting for directors expected to dominate this year’s shareholder confabs. Both issues come as little surprise. Executive pay looms large because the Securities and Exchange Commission is proposing a far-reaching overhaul of compensation disclosure, long a sore […]

What a difference a few months make. Since last fall, governance experts have anticipated a special report from the American Bar Association’s Committee on Corporate Laws that would re-examine the Model Business Corporation Act and possibly recommend majority election of board directors. Popular sentiment was that the Committee, chaired by former Delaware Chancery Court Chief […]

As any good corporate executive knows, hedge funds can attack quickly, causing all sorts of headaches as they grab headlines and shareholder attention with calls for various reforms. Little surprise, then, that experts now recommend companies create “rapid response teams” to defend themselves. A recent memo from law firm Wachtell, Lipton, Rosen & Katz urges […]

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 […]

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 […]

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” […]

The days of the imperial chairman and chief executive officer in American business are waning, as corporate governance practices increasingly separate power over management from power in the boardroom. That division is often embodied in the person of the “lead director,” the chief among independent board directors who can act as a shadow chairman. And, […]