The Upside of Finance Committees and Why Firms Create Them

By Sudipta Basu and Eunju (Ivy) Lee August 18, 2021 by renholding

Boards of directors at U.S. firms are increasingly using finance committees featuring financial experts to oversee complex finance-related matters. Since 2003, most U.S. public firms have been required by NYSE and NASDAQ to have audit, compensation, and governance committees. Finance …

SEC Commissioner Lee Addresses Climate, ESG, and Boards of Directors

By Allison Herren Lee June 29, 2021 by renholding

“You Cannot Direct the Wind, But You Can Adjust Your Sails”[1]

Good morning and thank you for the invitation to speak today at the Society for Corporate Governance 2021 National Conference. I’m impressed with your full and informative agenda

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Wachtell Lipton Discusses Key Corporate Governance Issues for Mid-Year 2021

By Martin Lipton, Steven A. Rosenblum and Karessa L. Cain June 28, 2021 by renholding

Last year, we did a mid-year edition of our annual Thoughts for Boards of Directors to highlight key issues and considerations in managing the challenging business environment and profound upheaval caused by the pandemic. Many of these issues are still …

Arnold & Porter Discusses Delaware Case on SPACs and Breaches of Fiduciary Duties

By Alexander Gendzier, Teresa L. Johnson and Nicholas O'Keefe June 15, 2021 by renholding

The complaint filed in Franchi v. Multiplan Corp. et al. in the Chancery Court of Delaware on April 9, 2021 [1], has received a fair amount of attention because it claims breaches of fiduciary duties of a SPAC’s Board of …

Aggressive Boards and CEO Turnover

By Cyrus Aghamolla and Tadashi Hashimoto June 4, 2021 by renholding

A common dilemma for people who seek advice is that good advice sometimes comes at the cost of revealing negative information about the persons seeking it. In the world of corporate decision making, a CEO who seeks the counsel of …

Religiosity, Higher Purpose, and the Effectiveness of Intense Board Oversight

By Todd T. Milbourn and Kingsley Wabara April 23, 2021 by renholding

Corporate boards that monitor their companies intensely engage in more effective oversight: Turnover of their CEOs is more closely linked to annual firm performance; CEO compensation is less often excessive; and earnings management is rarer. However, such boards are also …

Lifting Labor’s Voice: A Principled Path Toward Greater Worker Voice and Power Within Corporate Governance

By Leo E. Strine, Jr., Aneil Kovvali and Oluwatomi O. Williams February 25, 2021 by renholding

Many public policymakers and economists believe that American workers’ sharply declining share of corporate profits over the past few decades has been a major cause of increasing income inequality in the United States. To some, the explanation for this profound …

The Duty of Care for Board Members Should Include Competence in ESG

By Tensie Whelan February 18, 2021 by renholding

It is becoming clearer to investors and corporate managers that material environmental, social, and corporate governance (ESG) issues need to be managed as part of an organization’s business strategy. Climate change, racism, economic inequality, water scarcity, cybersecurity threats – these …

How CEO Membership on Outside Boards Affects Managerial Efficiency

By Canan Mutlu, Sunay Mutlu and Steve Sauerwald January 15, 2021 by renholding

CEO outside directorships and their value to companies have been a topic of debate among a wide range of stakeholders, particularly investors, boards, and policy makers. Some argue that CEO outside directorships benefit a CEO’s own firm by opening valuable …

Shareholder Lawsuits and CEO Turnover Decisions

By Rachel M. Hayes, Xiaoxia Peng and Xue Wang January 14, 2021 by renholding

Shareholder lawsuits have long prompted intense debate. Despite increased corporate democracy and shareholder rights, some commentators argue that shareholder litigation is still a shareholder’s best option to bring about changes. Shareholder litigation can impose personal liability on corporate managers and …

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 …

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 …

Arnold & Porter Discusses California Law Requiring “Underrepresented Community” Members on Boards

By Teresa L. Johnson and Amy Endicott October 2, 2020 by renholding

On September 30, 2020, California Governor Gavin Newsom signed into law a landmark bill (AB 979) requiring boards of directors of California-based public reporting corporations to have a minimum number of directors from underrepresented communities on their boards.

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Director Overlap: Groupthink versus Teamwork

By Jeffrey L. Coles, Naveen D. Daniel and Lalitha Naveen September 21, 2020 by renholding

Corporate boards are charged with the critical tasks of assessing top management performance and making compensation and dismissal decisions. Moreover, boards serve as a valuable source of advice and counsel to top management. While board members tend to be highly …

Recent Delaware Cases on Managing Conflicts: Board-Level Measures

By Nate Emeritz, Brian Currie and Jason Schoenberg September 4, 2020 by renholding

Recent Delaware case law offers useful guidance regarding options for management of potential conflicts. Those cases demonstrate that conflicts can be mitigated by board or stockholder actions and that such measures for managing conflicts should be thoughtfully tailored to the …

Wachtell Lipton Offers Thoughts for Boards of Directors in 2020

By Martin Lipton, Steven A. Rosenblum, William Savitt, Karessa L. Cain, Hannah Clark and Bita Assad July 8, 2020 by renholding

The past six months have been marked by a profound upheaval that has accelerated the growing focus on both the purpose of the corporation and the role of the board in overseeing and leading the corporation in ways that promote …

New Survey Finds Sharp Divide Over Pandemic’s Impact on Corporate Sustainability

By The Conference Board June 10, 2020 by renholding

New survey results show that most U.S. public company boards have stepped up their efforts in the initial phase of the COVID-19 pandemic, but shutting down businesses may have been the easy part. Boards face a growing list of urgent …

New Kids on the Block: The Effect of Generation X Directors on Corporate Performance

By Zhaozhao He, Mihail Miletkov and Viktoriya Staneva May 22, 2020 by renholding

Generational identity can influence many aspects of life, from family and work to political views to consumer and corporate behavior. In the United States today, there are four adult generations: Millennials (born 1982 – 2005), Generation X (born 1961 – …

The Risks and Rewards of Shareholder Voting

By Bernard S. Sharfman April 23, 2020 by renholding

[Editor’s Note: This and the following piece offer a point/counterpoint on shareholder voting.] The SEC’s recently proposed rules on proxy advisers and shareholder proposals have made shareholder voting one of the most prominently debated corporate governance issues ever. In a …

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