Columbia Law School
Sky Blog
Last time I flew to California, the skies were so clear that I was able to keep an eye on the changing landscape below all the way across the country. The vastness and great variety was striking. Having grown up
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Corporate Governance and Countervailing Power
The analysis of corporate governance has been a strikingly one-sided affair. The focus has been almost exclusively on “internal” checks and balances, namely scrutiny of executives by the board of directors and by shareholders. In contrast, mechanisms that can operate …
Why Firms Disclose a Supplemental CEO-to-Median Worker Pay Ratio
Pay disparity between executives and employees has been criticized as evidence of corporate greed. It can also create perceptions of unfairness and dissatisfaction among employees, weakening their commitment and performance. To provide more information about pay disparity, the U.S. Congress …
How Acquisition Performance Affects the Market for Non-Executive Directors
In the United Kingdom, successive codes of best practice in corporate governance have highlighted the important role of outside or non-executive directors in ensuring that corporations are run for the benefit of their shareholders. While the first code of best …
Changes in Corporate Governance: Externally Dictated vs. Organically Determined
Several major corporate scandals in the United States during the early 2000s brought attention to corporate governance of large U.S. companies. As a result, Congress passed the Sarbanes-Oxley Act (SOX), and the Securities and Exchange Commission (SEC) announced several regulations …
Corporate Governance that Works for Everyone
Corporate governance has traditionally been viewed as a way to reduce agency costs between shareholders and managers in the context of private ordering. Laws and regulations pertaining to corporate governance have, therefore, typically aimed to enhance long-term wealth for shareholders.…
The Governance Implications of Business Disruption
In 2018, corporate boards will increasingly be called upon to respond to how innovative competitors disrupt their companies’ business models. These competitors use technology, scale, and sharp insights into consumers to lower prices, improve products and services, and draw customers …
Does Shareholder Protection Drive Development of Stock Markets?
Does the quality of legal and other institutions make a difference to economic development and growth? In their very well-known studies of the relation between law and finance, Andrei Shleifer and his collaborators (in particular Rafael La Porta and Simeon …
How to Encourage Dialogue Between Boards and Institutional Investors in the U.S. and the EU
With institutional shareholders playing a growing role in corporate governance, dialogue between boards and shareholders is increasingly common in the U.S. and Europe. Talking with boards is essential to institutional investors’ stewardship functions, and engaging with institutional investors has become …
Wachtell Discusses How Capable and Committed Bank Boards Drive Deals and Create Value
Directors of regulated financial institutions have exceedingly difficult jobs with many demands. The aftermath of the financial crisis led to countless new regulatory requirements and expectations, many of these unwritten and evolving based on political currents or varying views at …
A Simple Plan to Liberate the Market for Corporate Control
It’s time to exempt a certain type of hostile bid – an all-cash, all-shares tender offer – from a poison pill defense. In essence, I propose a statutory rule requiring a board to remain neutral in the face of such …
Board Declassification Activism: Why Run From the Evidence?
How Directors’ Foreign Board Experience Improves Governance
The corporate governance literature has shown a strong link between good governance practices and firm value. The mechanisms, however, that determine the choice of effective corporate governance and board arrangements in a changing global market are not well studied. In …
Wachtell Lipton Shines a Spotlight on Boards for 2017
This past year witnessed a number of new corporate governance initiatives. Among the most significant:
- BlackRock, State Street and Vanguard each issued strong statements supporting long-term investment, criticizing the short-termism afflicting corporate behavior and the national economy and rejecting financial
Does CEO Succession Planning Matter?
In September 2009, Bank of America CEO Ken Lewis suddenly announced his intention to retire by the end of the year. The company’s board was taken by surprise as it scrambled to find a successor and was further embarrassed as …
Social Media: What Boards Need to Know
Increasing amounts of communications by and relating to companies are taking place through social media. Broadly defined, social media refers to forms of electronic communication through which users share information, ideas and other content (using text, audio, video and images). …