Should We Ban Short Sales in a Stock Market Crash?

By Marco Pagano March 17, 2020 by renholding

Few things are more predictable than loud demands for regulatory interventions to stop speculation when stock market prices plunge: In these days, as in any recent stock market crash, we hear politicians and commentators inviting regulators to enact interventions spanning

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How Boards of Directors Should Protect Against the Rising Storm

By Bill Ide, Michael Kelly and Amanda Leech March 17, 2020 by renholding

Prosecutors, regulators, investors, and the media are increasingly holding directors and officers accountable, while special interest groups, plaintiffs’ lawyers, and activist hedge funds are constantly looking for their next targets.

This new reality requires directors to be aggressive in overseeing …

Coronavirus, Systemic Risk, and Lessons from 2008

By Kathryn Judge March 16, 2020 by renholding

The greatest single-day decline in the stock market this century, widespread fear and uncertainty, shuttered schools, an end to large gatherings everywhere from NBA games to the South by Southwest festival – these are just a few of the signs …

Freshfields Discusses How Companies Can Switch to Virtual Annual Meetings After Proxy Filings

By Pamela L. Marcogliese, Elizabeth K. Bieber and Jillian Simons March 16, 2020 by renholding

Over the last five years, virtual annual shareholder meetings have been a small, but growing, trend. While percentage increases have been significant year-over-year, overall a relatively small number of companies held virtual meetings in that time.

Figure 1. Percentage of …

Why Stock Markets Are Essential at the Time of Coronavirus

By Luca Enriques March 13, 2020 by renholding

If stocks were still traded in pits, stock exchanges would have been shut down in China, Korea, Italy and possibly elsewhere a while ago. A bunch of men shouting and feverishly passing each other sheets of papers would have …

Coronavirus: Paul Weiss Discusses Employment Law and Guidance for Employers

By Jeh C. Johnson, Brad S. Karp, Loretta E. Lynch, Jean M. McLoughlin and Liza M. Velazquez March 13, 2020 by renholding

On January 30, 2020, in response to the increasing global spread of the novel coronavirus (COVID-19), the World Health Organization declared a “Public Health Emergency of International Concern.” Within a day, the United States and Italy followed suit. Since then, …

Peer Effects in Proxy Voting Decisions

By Jiekun Huang March 12, 2020 by renholding

Proxy voting decisions are characterized by strong strategic complementary relationships in the sense that the utility to a shareholder from voting in a particular manner increases with the extent that other shareholders vote in the same manner. Such complementarities arise …

Davis Polk Discusses SEC Move to Expand Private Offerings

By Maurice Blanco, Richard Truesdell, Joseph Hall, Byron Rooney and Sarah Solum March 12, 2020 by renholding

Last week, the Securities and Exchange Commission proposed broad changes to the current private offering framework. Recognizing the growing market for private investments, this is the latest in a series of recent actions by the SEC (including proposals to expand …

Shareholder Satisfaction with Overlapping Directors

By Rachel Li and Miriam Schwartz-Ziv March 11, 2020 by renholding

We investigate whether mutual fund shareholders are particularly supportive of “overlapping directors,” individuals who serve simultaneously on at least one corporate board and at least one mutual fund board. Overlapping directors may have a conflict of interest because of their …

Cleary Gottlieb Discusses UK Merger Control Enforcement Ahead of Brexit

By Nicholas Levy, Maurits Dolmans, Paul Gilbert and Ricardo Zimbron March 11, 2020 by hdh2120

The UK’s Competition and Markets Authority (CMA) is strengthening its approach to merger control as it prepares for its new status as a global enforcer with expanded jurisdiction.

Following the UK’s departure from the EU on 31 January 2020, the …

Can Socially Responsible CEOs Find Better Jobs?

By Xin Dai, Feng Gao, Ling Lei Lisic and Ivy Zhang March 10, 2020 by renholding

A large stream of literature in economics, finance, and accounting suggests that managers’ decisions are influenced by their labor market prospects. Absent perfect information about managers’ ability, the labor market often takes a firm’s current and past performance as a …

Why Controlling Shareholders Are Not Fiduciaries

By Paul B. Miller March 9, 2020 by renholding

Conflicts among shareholders are pervasive, whether rooted in personal animosity or differences of opinion on business matters. They arise in private and public corporations operating in all sectors of the economy. And in some cases, the conflicts are so large …

SEC Commissioner Lee on Protecting, Serving, and Empowering Investors

By Allison Herren Lee March 9, 2020 by renholding

Thank you Karen [Barr] and thank you all for hosting me today [March 5]. I appreciate IAA’s engagement on the issues important to its members and to the broader markets, and I’m honored to have the opportunity to speak to

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Can Institutional Investors Help the Market Evaluate Complex Legal Disputes?

By Paul Borochin, Xiaoqiong Wang and Siqi Wei March 6, 2020 by renholding

Do institutional investors have the ability to mitigate information asymmetries around complex corporate events? Securities class actions (SCA) are suitable for testing any informational advantage for institutional investors: The number of SCAs brought against U.S. firms has increased markedly in …

Davis Polk Discusses Acquittal of Ex-Alstom Executive on FCPA Charges

By Greg Andres, Neil MacBride, Martine Beamon, Tatiana Martins and Paul Nathanson March 6, 2020 by renholding

On February 26, a long-running legal battle over the scope of the Foreign Corrupt Practices Act (“FCPA”) took another turn when a federal trial court judge ordered that former Alstom executive Lawrence Hoskins be acquitted of the FCPA charges against …

Leveraging Corporate Law: A Broader Account of Delaware’s Competition

By Christopher M. Bruner March 5, 2020 by renholding

Delaware is widely known for providing the U.S. corporate law that governs most large, publicly traded companies. However, the economic imperatives prompting this have also led Delaware to explore opportunities in related though distinct fields, effectively leveraging its corporate law …

Wachtell Lipton Pushes Back Against Attack on Stakeholder Governance

By Martin Lipton, David M. Silk, William Savitt, Sabastian V. Niles and Carmen X.W. Lu March 5, 2020 by renholding

In an article posted yesterday [March 2] on the Harvard Law School Forum on Corporate Governance blog, Professor Lucian Bebchuk rejects stakeholder governance and, in so doing, attacks the committed positions of influential institutions as varied as the Business Roundtable, …

Mapping the Landscape of Comments to the SEC’s New Proxy Rules

By Jens Frankenreiter March 4, 2020 by renholding

In November 2019, the Securities and Exchange Commission (“SEC”) issued a notice of proposed rulemaking aimed at the roles played by proxy advisers in providing information and voting recommendations to clients. The move was preceded by substantively similar interpretive guidance …

Gibson Dunn Discusses CFIUS Reform and Final FIRRMA Rules

By Stephanie Connor, Judith Alison Lee, Jose Fernandez, R.L. Pratt and Scott R. Toussaint March 4, 2020 by hdh2120

On February 13, 2020, final regulations went into effect to expand the scope of inbound foreign investment subject to review by the Committee on Foreign Investment in the United States (“CFIUS” or the “Committee”).

CFIUS is an inter-agency federal government …

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The CLS Blue Sky Blog

Columbia Law School's Blog on Corporations and the Capital Markets

March 2020