Corporate boards of directors must tackle questions about sustainability in a new and urgent manner. If they don’t, they will hear from investors about their lack of action. In just the latest indication of the investor community’s increasing scrutiny on sustainability, Yahoo announced in 2018 that it would start publishing sustainability ratings for publicly traded companies...
Driving sustainable business practices in companies requires involvement from boards of directors . And there is some evidence that sustainability is ...
On January 1, California law said that all locally headquartered publicly traded companies must have at least one female director by 2020. While new to the U.S., mandates to increase gender diversity on corporate boards are common elsewhere. For example, Norway, Spain, France, and Iceland all have laws requiring that women comprise at least 40% of boards at publicly listed companies...
In the last two decades we have witnessed many large-scale corporate scandals ... monitoring bodies, and improved corporate governance practices...
A friend who serves on a number of consequential public company boards came to my office not long ago to ask my opinion on something that had become a contentious issue across his boards. The question: What is the proper role of a board with respect to company strategy?
For years women have sought greater representation on corporate boards. And most boards say they want more diversity. So why did women hold only 16.6% of Fortune 500 board seats in 2012? And why, for the past six years, has that percentage been relatively flat, increasing by just two points, according to data from the research firm Catalyst?
I sit on a board as a nonexecutive director and often feel uncomfortable about the amount of time available to raise questions and debate issues. In addition, I recently worked with a different board on how to add more value to the business. In this role I found myself counseling one of the directors to ask fewer questions and make fewer comments.
After years of asking corporate directors about the importance of diversity in ... in cooperation with Stanford's Rock Center for Corporate Governance , ...
Ever since Adam Smith published The Wealth of Nations in 1776, observers have bemoaned boards of directors as being ineffective as both monitors and advisors of management. Because a CEO often effectively controls the director selection process, he will tend to choose directors who are unlikely to oppose him, and who are unlikely to provide the diverse perspectives necessary to maximize firm value. Institutional investors often are critical of CEOs’ influence over boards and have made efforts to help companies improve their governance. Nonetheless, boards remain highly imperfect.
“Go find your passion,’’ Henry directed his children when they reached their late teens and early twenties. “Find your interests outside our family business and pursue them.’’ As inspiring as those words may have been, Henry, the patriarch of a successful automotive parts business, wasn’t simply freeing his children to follow their dreams. He was requiring it.
Corporate directors and executives alike recognize that today’s pace of change continues to accelerate and that firms need to innovate to stay ahead. But are boards doing enough to support innovation, as they should? We conducted a survey of over 5,000 board members from around the world to find out...
When asked why companies don't talk more about the long term, CEOs ... risks and opportunities, corporate governance , corporate purpose, human ...
However, Germany relies on a specific corporate governance model which is not ... Corporate governance is just one part of a “package” of economic ...
... GE's long and steep decline, where was the company's board of directors ? ... GE's board had another major structural defect: It lacked a finance ...
Richard (not his real name) graduated from college on a Friday. Three days later he would start his first day on the job in his family business. The choice was not one that he gave much thought to.
The stigma of asking for or being assigned an executive coach is vanishing quickly. The growth of the industry tells us so. In the U.S. alone, $1 billion was spent on business, personal and relationship coaches last year, according to IbisWorld, up about 20% from five years earlier.
The board of directors of a public company has a long list of oversight responsibilities, but it is not always the case that directors receive the ...
To estimate the effect of a CEO's social network's diversity on their firm's value, we used ordinary least square regression models to control for other variables that could potentially change firm value, such as firm size, profitability, financial leverage, investment intensity, and corporate governance .
These techniques are rapidly changing many industries — could they also improve corporate governance ? To explore that question, we conducted a study of how machine learning might be used to select board directors, and how the selected directors might differ from those selected by management.
Most board chairs are experienced leaders. Half the chairs of the S&P 500 double as their companies’ chief executives, and the vast majority of the rest are former CEOs. But the close association of the two positions creates problems. It’s difficult for a board led by the CEO to serve as a check on that CEO—which is precisely why, after the corporate scandals of the 1990s and early 2000s, more companies began separating the roles. However, that division can create another problem: When the chair is not the CEO, there’s a real danger that he or ...
One defining feature of 2017 has been seeing corporate directors and officers being held personally responsible for illegal behavior at their companies. For example, after Wells Fargo Bank paid more than $300 million in penalties for creating over 3 million sham customer accounts, Judge Jon Tigar of the U.S. District Court in San Francisco refused to dismiss claims against the fifteen members of the Wells Fargo board. And Oliver Schmidt, the highest ranking Volkswagen officer residing in the United States, was sentenced to seven years in prison and ordered to pay $400,000 for his role in the VW ...
The public corporation is typically bedeviled by the gap between managers’ and shareholders’ interests. Over the years, governance has attempted to close that gap by aligning incentives with measures of performance. These attempts have often failed. But where they have succeeded, they have left public corporations increasingly swayed by short-term results (which are easy to measure) at the expense of future success.
Mary Barra, Meg Whitman, Indra Nooyi: These are just three of the women who have successfully broken through the notorious “glass ceiling” to become CEOs of large public firms. Although women are still underrepresented at the top of corporations, there is growing interest in understanding whether ...
With a typical CEO of an S&P 500 company earning $11 million in total ... is significantly tighter and more competitive than governance experts might ...