Corporate Governance

Do Investors Prefer Women CEOs at Firms Targeted by Activists?

By Scott C. Jackson, Chris Agoglia and Dave Piercey April 22, 2022 by renholding

Shareholder activism is playing a larger role than ever in companies’ decisions about their operations and reporting, with over 4,600 firms targeted worldwide from 2013 to 2018. Shareholder activists can have several motives for going after a company, from trying …

Wachtell Lipton Puts Spotlight on Boards: Spring 2022 Update

By Martin Lipton, Steven A. Rosenblum, Karessa L. Cain and Hannah Clark April 21, 2022 by renholding

The ever-evolving challenges facing corporate boards prompt periodic updates to a snapshot of what is expected from the board of directors of a public company—not just the legal rules, or the principles published by institutional investors and various corporate and …

Skadden Discusses Proposed 2022 Amendments to Delaware Corporation Law

By Allison L. Land and Edward B. Micheletti April 20, 2022 by renholding

On April 12, 2022, the Corporation Law Section of the Delaware State Bar Association (DSBA) approved proposed amendments to the Delaware General Corporation Law (DGCL) that include provisions that, if enacted, would authorize exculpation clauses limiting or eliminating the monetary …

Moonshots

By Matthew Wansley April 18, 2022 by renholding

In the last half-century, technological progress has stagnated. The century from 1870 to 1970 brought electricity, running water, telephones, television, automobiles, and airplanes. Life expectancy at birth rose from 45 to 72. But since the early 1970s, progress has been …

Why Delaware and England Win the Global Corporate Law Race

By Ido Baum and Dov Solomon April 14, 2022 by renholding

What makes the corporate laws of some jurisdictions more attractive for entrepreneurs and investors than others in the global arena? Within the United States, the competition among state laws is a popular explanation for Delaware’s corporate law prominence. However, interjurisdictional …

Going Private Outside Delaware: Holes in the Director Raincoat and Other Concerns

By Matthew G. Doré April 12, 2022 by renholding

Meade v. Christie et al., an interlocutory appeal in a shareholder class action challenging a going private merger, is currently pending before the Iowa Supreme Court.[1] The appeal will test the strength of a director-liability shield law patterned on …

Skadden on Revisiting Share Repurchases in Volatile Times

By David Goldschmidt, Mike Zeidel, Laura Kaufmann Belkhayat, Yossi Vebman and Sebastian Sanchez Rivera April 12, 2022 by renholding

In light of the recent increased volatility in the global financial markets,¹ a number of companies have raised questions regarding the desirability of repurchasing shares at reduced market prices. This alert addresses questions surrounding share repurchases that companies should …

Boardroom Gender-Diversity Reforms and Institutional Monitoring

By Larry Fauver, Mingyi Hung, Alvaro G. Taboada and Emily Jing Wang April 11, 2022 by renholding

The past decade has seen an explosion of boardroom gender diversity reforms worldwide. As of 2014, 23 countries have amended governance codes and 14 countries have enacted laws to increase gender diversity on corporate boards. While investors play a critical …

Wachtell Lipton Discusses SEC’s Proposed Climate-Related Disclosure Rules and Audit Committees

By David M. Silk, Carmen X.W. Lu and Ram Sachs April 11, 2022 by renholding

The SEC’s proposed amendments to Regulations S‑K and S‑X to require new climate-related disclosures will, if adopted, require an expansion in the scope and responsibilities of audit committees.  As described in our prior memo, the rules contemplate domestic and foreign …

Controlling Tunneling Through Lending Arrangements

By Alperen Afşin Gözlügöl April 8, 2022 by renholding

In a recent article, I examine how common provisions in lending arrangements (drawing from the LMA and LSTA modal agreements) handle the problem of value diversion in debtor companies. “Tunneling,” which is the expropriation of company value by corporate …

To Call a Donkey a Racehorse: The Fiduciary Duty Misnomer in Corporate and Securities Law

By Marc I. Steinberg April 7, 2022 by renholding

In a new article, I address a subject that has been ignored for too long:  The fiction of meaningful fiduciary standards in the corporate and securities laws contexts. My article explores the standards that legislatures and courts apply to corporate …

The Limits of Enlightened Shareholder Activism

By Virginia Harper Ho April 6, 2022 by renholding

One of the more visible market shifts over the past decade is the rise of what might be called “enlightened shareholder activism” – the use of shareholders’ governance rights to encourage corporations to take action around environmental, social, and governance …

Sullivan & Cromwell Discusses Court Decision Invalidating California Board Diversity Law

By Patrick S. Brown, Diane L. McGimsey, Adam S. Paris, Alexandria M. Ross and John L. Savva April 6, 2022 by renholding

On April 1, 2022, in Crest v. Padilla, California Superior Court Judge Terry Green granted summary judgment in favor of plaintiffs who had challenged AB 979, one of California’s two board diversity statutes, as violating the California Constitution.  The …

Wachtell Lipton Discusses Board Oversight of ESG and the 2022 Proxy Season

By David M. Silk, Sabastian V. Niles and Carmen X.W. Lu April 4, 2022 by renholding

Last year’s proxy season saw investor support for an unprecedented number of ESG proposals, on issues ranging from climate change to human capital management to diversity, equity and inclusion.  Proxy advisory firms increasingly recommended that shareholders vote for such proposals.  …

How to Translate Climate Disclosure into Investor Action

By Felix Mormann and Milica Mormann March 31, 2022 by renholding

Massive investment is required if mankind is to meet, and master, the challenges presented by global climate change.  A recent report by McKinsey & Company posits that capital spending on energy and land-use infrastructure alone will need to exceed $9 …

Exequity Discusses Board Committee Oversight of ESG

By Ben Burney and Emily Brown March 30, 2022 by renholding

Over the past two years, Environmental, Social, and Governance (ESG) matters have become an increasingly important issue in the boardroom. This trend is accelerating today as a growing number of investors and stakeholders expect companies to both produce strong stock …

Does Media Exposure Affect Financial Reporting Quality Through Auditors?

By Steven Cahan, Chen Chen and Rencheng Wang March 24, 2022 by renholding

The media play an important role in capital markets. Media coverage can attract the attention of investors and the public at large and affect the decisions of management. As such, the media can have a corporate governance role in disciplining …

Max Oversight Duties: How Boeing Signifies a Shift in Corporate Law

By Roy Shapira March 21, 2022 by renholding

In September 2021, the Boeing 737 Max debacle turned into an important moment in corporate law. A Delaware court allowed a derivative lawsuit brought by Boeing shareholders to proceed, based on the theory that Boeing’s directors breached their oversight duties …

The “S” in ESG: Human Capital Management

By George S. Georgiev March 16, 2022 by renholding

Over the past decade, ESG has morphed from a fringe concern into one of the most prominent topics in corporate governance – and a flourishing research area as well.[1] Nevertheless, some notable blindspots remain. Based on a recent survey, …

ISS Discusses Women on California Boards

By Paul Hodgson March 15, 2022 by renholding

Since 1995, US presidents have issued a series of annual proclamations designating March as Women’s History Month to celebrate the contributions women have made to the US and recognize the specific achievements women have made over the course of American

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