Gender Gap at the Top: New Evidence on Policy Effectiveness

By Swarnodeep Homroy and Shibashish Mukherjee October 30, 2020 by renholding

The persistent gender gap in corporate leadership has led several European countries to institute board-related policies such as gender quotas, starting with Norway in 2003. Recently, California became the first U.S. state to follow suit, with many more considering similar …

Columbia’s Millstein Center Presents Global Investor-Director Survey on Climate Risk Management

By Jens Frankenreiter, Sophie L’Hélias, Nina Hodzic, Sneha Pandya and Eric Talley October 30, 2020 by snehapandya

Changes in the global climate are having profound impacts on business operations, governance, and organizational management around the world. Boards of directors are searching for ways to account for these changes as they help guide their organizations, and investors are …

To Mask Or Not To Mask? It’s Not a Constitutional Question

By Daniel R. Karon and Giliann E. Karon October 29, 2020 by renholding

In 1979, police in Pensacola, Florida, arrested Ku Klux Klan member B.W. Robinson for covering his face at a rally. He pleaded no contest so he could appeal his conviction to the Florida Supreme Court. Once there, Robinson challenged the …

SEC Chair Clayton Speaks on Regulations for Funds’ Use of Derivatives

By Jay Clayton October 29, 2020 by renholding

Today [October 28], we are considering a new rule to provide an updated and comprehensive regulatory framework for the use of derivatives by registered investment funds, including mutual funds and exchange traded funds (ETFs). I have spoken before on the

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SEC Officials Issue Joint Statement on Complex Financial Products and Retail Investors

By Jay Clayton, Dalia Blass, William Hinman and Brett Redfearn October 29, 2020 by renholding

Retail investors have a wide array of investment options available to them, including an increasing number and type of investment products that are more complex than conventional stock and bond investments.[1] These complex products may be exchange-traded or sold

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Racial Diversity and Corporate Governance: Assessing California’s New Board Diversity Mandate

By Courtney Murray and Eric Talley October 28, 2020 by renholding

Corporate governance is historically perceived as a specialized, idiosyncratic and somewhat arcane field. But increasingly, it has come to serve as a lightning rod for broader public debates. Perhaps no moment underscores this trend more sharply than the 2020 …

SEC Chairman Clayton Addresses Regulation Best Interest and Form CRS

By Jay Clayton October 28, 2020 by renholding

Good afternoon and welcome to the SEC’s Staff Roundtable on Regulation Best Interest and Form CRS.[1] We hope that this event provides useful information to broker-dealers and investment advisers in complying with these key regulatory enhancements. Staff from the

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The Role of Institutional Investor Regulation in Restoring a Fair, Sustainable Economy

By Leo E. Strine, Jr. October 27, 2020 by renholding

In a new essay, available here, I discuss the essential but insufficient role of regulation to promote more effective stewardship by institutional investors. My essay offers a frame for specific policy recommendations that align the responsibilities of institutional investors …

Paul Weiss Discusses Initiatives to Unify ESG Reporting

By Mark S. Bergman, Ariel J. Deckelbaum, Brad S. Karp and Scott P. Grader October 27, 2020 by Nisha Chandra

ESG reporting is now recognized as a significant agenda item in the ESG space. The plethora of different reporting standards has caused concern and confusion, as those responsible for providing disclosure, as well as the intended beneficiaries of the disclosure, …

Why Corporate Purpose Will Always Matter

By Lyman Johnson October 26, 2020 by renholding

Business persons and lawyers have long debated whether a business corporation does or should have a purpose other than advancing shareholder interests. In a democratic, pluralist society, the issue of corporate purpose remains important and will not (and should not) …

Fenwick & West Discusses Mitigating Class Action Litigation Risk for SPAC Transactions

By Jay Pomerantz, Marie Bafus, David Michaels and Nicolas Dumont October 26, 2020 by Nisha Chandra

Special purpose acquisition companies (SPACs) are increasingly being used as an alternate vehicle to traditional initial public offerings. Companies that go public through a traditional IPO process are often subject to shareholder securities class actions. Inevitably, securities class actions will …

The Deterrent Effect of Whistleblowing on Insider Trading

By Jacob Raleigh October 23, 2020 by renholding

One of the many significant reforms enacted in The Dodd–Frank Wall Street Reform and Consumer Protection Act of 2010 was the creation of a whistleblower bounty program within the SEC. The program increased monetary rewards for whistleblowing and provided protections …

Morrison & Foerster Discusses the Private Side of Going Private Transactions

By Brian J. Snyder and Ruomu Li October 23, 2020 by renholding

In this article, we follow up on our overview of going private transactions (available here) by focusing on an important but often overlooked workstream in these deals. Companies are frequently privatized by a group of significant shareholders, outside investors …

Banking Bailout Law

By Virág Blazsek October 22, 2020 by renholding

Bank bailouts during periodic financial crises aim to stop financial panic and restore the stability of the financial system. Even if they are undesirable, future bank bailouts are unavoidable due to political and political economy reasons, whether or not they …

Davis Polk Discusses SEC Rebuke Over Stock Buybacks Under 10b5-1 Plan

By Maurice Blanco, Robert Cohen, Joseph Hall, Michael Kaplan and Richard Truesdell October 22, 2020 by renholding

On October 15, the SEC announced a settlement stemming from a company’s series of stock buybacks undertaken pursuant to a Rule 10b5-1 plan. Although the SEC concluded that the company initiated the 10b5-1 plan at a time when it possessed …

How Shareholders View CEO Pensions and Deferred Compensation

By Carl Hsin-han Shen and Hao Zhang October 21, 2020 by renholding

Defined-benefit pension plans and deferred compensation are often sizable and important components of CEO pay packages. In recent years, though, they have prompted controversy among investors, policymakers, and academics. On the one hand, CEO pension and deferred compensation are unsecured …

Preparing for the Transition from LIBOR to SOFR: The ARRC Recommendations

By Merrill Stone October 21, 2020 by renholding

The London Interbank Offered Rate (LIBOR) has been the standard floating rate benchmark for debt instruments of all kinds around the world for decades. It is calculated every banking day by polling major banks on their estimated borrowing costs for …

How SEC Enforcement Affects Insider Leakage

By Sid Ghoshal, Martin Bengtzen and Stephen Roberts October 20, 2020 by renholding

In 2012, Mary L. Schapiro, the chairwoman of the Securities and Exchange Commission, argued that market participants had “short memories” and that the SEC as a result had to take regular enforcement actions “so that people don’t forget that they …

Latham & Watkins Discusses SEC Proposal of Safe Harbor Framework for Unregistered Finders

By Dana G. Fleischman, Stephen P. Wink, Gail S. Neely, Naim Culhaci and Deric Behar October 20, 2020 by renholding

On October 7, 2020, the US Securities and Exchange Commission (SEC) issued a Notice of Proposed Exemptive Order Granting Conditional Exemption from the Broker Registration Requirements of Section 15(a) of the Securities Exchange Act of 1934 for Certain Activities of …

Has the Stock Market Become Less Representative of the Economy?

By Frederik P. Schlingemann and René M. Stulz October 19, 2020 by renholding

In the summer of 2020, with the U.S. economy bearing the impact of the COVID-19 pandemic, the unemployment rate was as high as it had been any time since 1948, and the NASDAQ and the S&P 500 indices reached their …

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The CLS Blue Sky Blog

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

October 2020