The Effects of SEC Comment Letters on Compensation Contract Efficiency

By Rachel Geoffroy, Sophia Hamm and Brent Schmidt February 14, 2023 by renholding

In a new paper, we examine whether SEC comment letters on deficiencies in compensation disclosure have an impact on executive-compensation “contract efficiency,” meaning the extent to which such contracts align with shareholder interest. The goal of comment letters is not …

Is Social Justice a Corporate Scam?

By Dan Subotnik February 14, 2023 by renholding

Last December, Subaru boasted in TV ads of having donated over $250 million to charity in the last few years. The company specifically claimed that it was the ASPCA’s largest corporate donor. Animal lover that I am, I got a …

Risk-Seeking Corporate Governance

By Brian Broughman and Matthew Wansley February 13, 2023 by renholding

Several developments suggest that venture capitalists (VCs) are retreating from their traditional corporate governance role of monitoring their portfolio companies. Startup founders are retaining more equity and control over their companies, and contrary to past practice, some VCs say they …

ISS Discusses Dual-Class Share Structures in Europe

By Paul Hodgson February 13, 2023 by renholding

While unequal voting structures in the U.S. are commonly associated with technology and media companies, there is no such industry specific tendency in Europe – with its tradition of so-called “loyalty shares” and government ownership. This paper surveying dual class

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Skadden Discusses ESG in 2022 and Predictions for 2023

By Raquel Fox, Marc S. Gerber, Aurora Luoma, Greg Norman and Simon Toms February 10, 2023 by renholding

Following another year of increasing focus on environmental, social and governance (ESG) considerations by companies, investors and regulators alike, ESG appears to have cemented its position in the corporate landscape. As set out in our 28 July 2022 client alert …

How Companies Evaluate Their Corporate Governance

By Lauren Cunningham, Christie Hayne, Terry Neal and Sarah Stein February 9, 2023 by renholding

Practitioners and academics alike debate best practices in corporate governance, but rarely do companies reveal how they determine what governance practices work best for them. In a new paper, we report the results of interviews on this topic with …

What is the SEC Hiding?

By Alexander Platt February 8, 2023 by renholding

Under Chair Gary Gensler, the U.S. Securities and Exchange Commission (SEC) has been on a transparency rampage – proposing extensive new disclosure obligations on public companies, activist investors, private funds, and (maybe soon) so-called “unicorn” startups. …

SEC Chair Gensler Speaks Before Small Business Capital Formation Advisory Committee

By Gary Gensler February 8, 2023 by renholding

Good morning. It is good to join the advisory committee for your first meeting of the year. As is customary, I’d like to note that my views are my own and I am not speaking on behalf of the Commission …

Does ESG Information Affect Individual Investors’ Portfolio Choices?

By Catharina Janz, Rainer Michael Rilke and B. Burcin Yurtoglu February 7, 2023 by renholding

Socially responsible investing (SRI) involves considering environmental, social, and governance (ESG) issues when picking stocks. Once a niche area of fund management, the volume of global sustainable investment in five major markets reached $35.3 trillion at the start of 2020, …

Mayer Brown Discusses Five Steps for Directors to Consider About Risk Governance

By Matt Bisanz, Andrew Noreuil, Jodi Simala, Bill Kucera and Megan Webster February 7, 2023 by renholding

Historically, directors have been protected from personal liability in connection with risk management by the high standard set in the seminal 1996 Caremark[1]case. In recent years, however, courts have held that certain plaintiffs have pled facts sufficient to …

Does the Market Misprice Companies’ “Strategic Alternatives” Announcements?

By Jenny Zha Giedt February 6, 2023 by renholding

Seeking “strategic alternatives” is a euphemism for a company trying to sell itself, which typically results in an acquisition premium for shareholders, and many announcements of strategic alternatives explicitly state that the goal is maximizing shareholder value. Upon a company’s …

Simpson Thacher Discusses Supreme Court Case on Standing and Direct-Listing Shares

By Jonathan Youngwood, Peter Kazanoff, Craig Waldman, Stephen Blake and David Elbaum February 6, 2023 by renholding

On December 13, 2022, the Supreme Court granted certiorari to consider whether Sections 11 and 12(a) of the Securities Act require a plaintiff who purchased shares through a direct listing to plead and prove that he bought shares registered under …

Skadden Discusses Delaware Chancery Decision Questioning Fundamental SPAC Structure

By Howard L. Ellin, Edward B. Micheletti, Gregg A. Noel, Richard C. Witzel, Jr. and Sarah Runnells Martin February 3, 2023 by renholding

With all the SPAC activity and scrutiny over the past several years, it was only a matter of time before the Delaware courts had an opportunity to weigh in on SPAC stockholder litigation.

Early last year, in January 2022, Vice …

Wachtell Lipton Discusses Mergers and Acquisitions–2022 and 2023

By Wachtell, Lipton, Rosen & Katz February 2, 2023 by renholding

2022 was a tale of two halves for M&A. The beginning of the year was active, as robust dealmaking carried over from the record-breaking levels of 2021 to drive approximately $2.2 trillion worth of global deals through the first half …

SEC Commissioner Urges Reform of Regulation D and Private Markets

By Caroline A. Crenshaw February 2, 2023 by renholding

Thank you Thomas [Kim] for that lovely introduction and I’m very pleased to be here at the Securities Regulation Institute giving the Alan B. Levenson Keynote Address. Director Levenson was the consummate public servant who left an enduring mark on

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How Institutional Ownership and Board Diversity Affect Innovation

By Thi-Thanh Phan and Hai-Chin Yu February 1, 2023 by renholding

In a new paper, we investigate the relationships between institutional ownership, board diversity, and corporate innovation in U.S.-listed firms. Institutional investors play a crucial role in a firm’s operation and exert considerable influence on the efficient monitoring of innovative investment. …

Debevoise Discusses Malicious Corporate Deepfakes

By Avi Gesser, Megan Bannigan, Christopher Ford, Anna Gressel and Scott Caravello February 1, 2023 by renholding

Content generated by artificial intelligence (“AI”) continues to improve and become more convincing. These realistic images, audio, and videos, where used for purposes of a misrepresentation or to falsely spread information, are commonly dubbed “deepfakes.” Governments around the world are …

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The CLS Blue Sky Blog

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

February 2023