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Compensation Committees & ESGIssue: 2019 Annual ReportHuman capital management and oversight should be a bigger part of the agenda.Environmental, social and governance (ESG) issues are increasingly important to boards and their compensation committees, especially human capital management, as a critical part of the “S” in ESG.Comp committees realize...
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My Board Journey: DEBORA PLUNKETT, Director, Nationwide, J.C. Penney, CACI International, Raytheon Integrated Defense Systems.Issue: 2019 Annual ReportWhat was the process that led you to Nationwide’s boardroom? I was contacted by a senior leader at the company, who asked if I would be interested in interviewing for an anticipated opening. This has been a common path for me — someone refers me or calls because they are familiar with my work in...
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Survival Guide: How Kurt Landgraf prepares for board meetings.Issue: 2019 Annual ReportAs president of Washington College in Chestertown, Maryland, Kurt Landgraf has a packed calendar. Yet, Landgraf happily makes time to serve on the boards of two major U.S. corporations. “I think it’s fascinating, especially if they’re corporations you really like,” he says about Corning...
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TOP OF MIND: What directors are thinking (Janet S. Wong, Enviva Partners, BigControls)Issue: 2019 Annual ReportThe focus on the value of more diversity on corporate boards has specifically emphasized women, but not all women.Numerous resources have been developed to help companies identify qualified women candidates for board seats, and as a result, gender representation is slowly increasing. Today, women re...
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ESG Lessons from S&P’s Facebook SmackdownIssue: 2019 Annual ReportThe S&P 500 ESG (environmental, social and governance) Index lost a few familiar names during its annual rebalancing, including Wells Fargo, Oracle and IBM. But the one that made the most news, and the biggest component of the index, was Facebook.While Facebook did well when it came to the envir...
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How Well Do You Really Know the Shareholders You Represent?Issue: 2019 Annual ReportA few years back, I was at a non-business cocktail party, chatting with someone I had just met. It was a great conversation, as I recall, until I learned that he was a board member of a company in which I held stock, and I shared that fact with him.My holdings were small, comparatively, but large en...
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The Runaway CEO Gravy TrainIssue: 2019 Annual ReportForty years ago, Directors & Boards posited the question, “Is Any CEO Worth $1 Million?” Today, almost all CEOs are apparently worth $1 million — often $1 million a month!As our nation struggles to come to grips with income inequality, wealth disparity and social injustice, corporate bosse...
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Weighing ESG Against Directors’ Fiduciary DutyIssue: 2019 Annual ReportA focus on environmental, social and governance benefits should be framed by the lens of business benefits.The directors of a Delaware corporation have a fiduciary duty to manage the corporation, in good faith, in the best interests of the stockholders. Under Delaware law, this means, in ...
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Investor Engagement & Sustainable InvestingIssue: 2019 Annual ReportToo Important to Ignore.Applying ESG — environmental, social and corporate governance criteria — to investing decisions is no longer a niche, it’s mainstream. Many of the world’s largest asset owners are now leading the sustainable investing movement, developing increasingly sophisticated ap...
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Getting More Diverse Voices to the Board TableIssue: 2019 Annual ReportCan the environmental, social and governance movement finally usher in change?The environmental, social and governance movement feels more radical today than the well-intended social-good phenomenon that the current U.S. corporate leadership remembers from the 1980s, (i.e. anti-apartheid divestment ...
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Gender Diversity in the BoardroomIssue: 2019 Annual ReportLaw firms, investors and watchdogs keep the heat on.“Board diversity and expanding the pool” are among the top issues that companies are being called upon to prioritize, according to a recent memo from the law firm Wachtell, Lipton, Rosen & Katz titled “Board Development and Director Succe...
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The New “New Paradigm”Issue: 2019 Annual ReportFighting short-termism by embracing purpose and all stakeholders.By Martin LiptonAt the request of the World Economic Forum, together with a team of my Wachtell Lipton colleagues, I prepared “The New Paradigm: A Roadmap for an Implicit Corporate Governance Partnership between Corporations and Inve...
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Investor Capitalism Prevailed: Now What for Long-Termism?Issue: 2019 Annual ReportInstitutional investors need to continue pushing for board leadership.It has been a quiet revolution.In the old days, circa 1950, small holders, our parents and their parents, owned most of America’s largest publicly traded companies. Now, some 70 years later, they have been replaced by the great ...
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Achieving Gender Parity on BoardsIssue: 2019 Annual ReportCorporate leaders who have paved the way share their insights and strategies.Corporate leaders spearheading gender parity in the boardroom can provide a window into how to achieve what many see as unachievable.These companies are in a unique group of nearly 325 with 30% or more women on their boards...
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Forcing ESGIssue: 2019 Annual ReportFrom holding CEOs accountable to mandating women on boards, some policymakers want to mandate that corporations do good.For the first time since the Great Depression, companies are vulnerable to a range of proposed legislation that attempts to rein in what some believe are freewheeling behaviors all...
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Investors Want More Human Capital OversightIssue: 2019 Annual ReportTime for directors to oversee “the most important asset.”Directors are questioning whether they should be exercising more oversight of human resources management, and that’s leading to changes in the boardroom.At Caterpillar Inc., the board now has a compensation and human resources committee....
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SEC Chief Takes on Short-Termism and ESGIssue: 2019 Annual ReportChairman Jay Clayton wants to bolster long-termism by streamlining reporting requirements, and his agency is evaluating new human-capital risk disclosures.The decline of long-term thinking “bothers” Jay Clayton, the chairman of the Securities & Exchange Commission.It isn’t good for investo...
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Corporate Governance at Mid-Market CompaniesSurvey finds most companies have independent chairs, and a rise in dual-class stock structuresA new survey of mid-market public companies sheds light on a host of corporate governance practices, from board size to stockholder activity.The study, by law firm Benesch, looked at companies with market c...
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Director Data Annual Report 2019Trends for the 2019 Proxy SeasonShareholder voting during 1,024 meetings held during the “mini-season” between July 1 and Dec. 31, 2018 provides a window into what’s in store for the 2019 proxy season. A total of 3,637 directors stood for election this past season — 143 of them failed to rec...
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Elizabeth Warren’s Accountable Capitalism ActIssue: 2019 Second QuarterDelaware’s supreme court chief justice sees merit in calling for employee representation in the boardroom and ESG disclosure for all large companies — public and private. Last year, U.S. Sen. Elizabeth Warren, D-Mass., who is also running for president, introduced the Accountable Capitalism...