There is an active debate in the literature as to whether antitakeover provisions (ATPs) that shield managers from takeovers create or destroy firm value. While most studies focus on the average effects of ATPs across all firms and time, the recent COVID-19 pandemic and the massive drop in share prices the pandemic caused raised another important question in this debate...

Over the past two decades, the concept of “board diversity” has been synonymous with female representation on boards. Since 1999, nearly 20 governments around the world have instituted gender quotas. Recently however, the notion of corporate board diversity has been expanded...

As 2022 approaches, companies are confronting an ever-expanding list of internal and external pressures on their business from a strategic, operational, governance, stakeholder and regulatory perspective...

ISS recently published its 2022 policy updates, which will go into effect for annual meetings held on or after February 1, 2022 (and, in some instances, February 1, 2023). This post discusses key updates made to ISS’ compensation and Environmental, Social and Governance (ESG) voting policies...

In our article, Corporate Political Spending is Bad Business, we explore the deep problems that corporate political spending poses for corporations and their management. In particular, we highlight the lack of legitimacy underpinning management decisions to spend treasury dollars on political causes as well as the “hypocrisy trap” for companies that donate to causes that undermine their stated values...

On December 7, 2021, Institutional Shareholder Services (ISS) published updates to its U.S. benchmark proxy voting policies. Unless specified otherwise, the new policies are applicable to all U.S. company meetings held on or after February 1, 2022. This year, ISS’s key policy updates relate to the issues of board composition and board accountability...

ESG is a growing imperative for investors of all types—from considering ESG when assessing individual issuers to modeling the impact of climate change on investment strategies. For multi-asset investors, there’s another ESG dimension to incorporate: translating organizational ESG objectives into an effective strategic asset allocation...

This paper considers a rulemaking effort underway at the Securities and Exchange Commission to regulate the conflicts of interest that result when brokers send client orders to venues that pay the broker a fee in exchange for routing to them...

The 26th meeting of the UN Conference of the Parties (COP26) led to several newsworthy developments, with companies, countries, and coalitions announcing various initiatives and pledges throughout the thirteen-day meeting. We found the two below especially significant...

BlackRock’s purpose is to help more and more people experience financial well-being. We manage assets on behalf of institutional and individual clients, across a full spectrum of investment strategies, asset classes, and regions...

The US Department of Justice’s (DOJ’s) new policy on corporate fraud enforcement and individual accountability is a significant development around risk, and corporate directors should be aware...

In the 2021 proxy season, 143 of the technology and life sciences companies included in the Fenwick – Bloomberg Law Silicon Valley 150 List (SV 150) and 99 of the companies in the Standard & Poor’s 100 (S&P 100) held annual meetings that typically included voting for the election of directors, ratifying the selection of auditors of the company’s financial statements and voting on executive officer compensation (“say-on-pay”). Annual meetings will often also include voting on ...

State Street Global Advisors (“SSGA”), one of Wall Street’s “Big Three” asset managers, has very recently been featured in the news for adopting a new policy where its recruiters will need to seek a diversity panel’s approval if they want to hire a white male management candidate over a woman or an ethnic minority...

On October 13, the Department of Labor (DOL) issued a proposal that would roll back some of the environmental, social and governance (ESG) investing rules that were finalized by the Trump administration at the end of 2020. The Trump administration rules caused uncertainty regarding fiduciaries’ ability to use ESG funds in the retirement plans that they sponsor...

SPACs have gotten their share of critical attention over the past year, including by us here and here. But there has been little attention paid to the weak corporate governance of many SPACs, and less attention paid to judicial review of alleged breaches of fiduciary duties. We have recently posted a paper on those topics here. In this post, we summarize that analysis...

Dodge v. Ford is one corporate law’s iconic decisions, regularly taught in law school and regularly cited as one of corporate law’s core shareholder primacy decisions. Ford Motor slashed its dividend in 1916 and minority stockholders—the Dodge brothers—successfully sued Ford Motor Company for a big dividend payout...

There is a long history of governance reforms that target corporate boards by mandating specific committee structures and director-type requirement. The Securities and Exchange Commission and the New York Stock Exchange first advocated for separate audit committees following the McKesson & Robbins scandal of 1938...

In 2021, ESG investing has grown to $35+ trillion—over a third of the world’s professionally managed assets. ESG is now well and truly mainstream across the globe. Soon ESG investing will be investing, or at the very least a fundamental component of all investing...

BlackRock, the world’s largest asset manager, announced on October 7, 2021 that it will start giving certain of its institutional index equity clients the ability to instruct BlackRock how those clients would like their votes to be cast at shareholder meetings of companies in BlackRock’s index funds. This move is savvy...

Public ownership of shares is, in many ways, the essence of modern capitalism — which, along with the rule of law, has been responsible for the spectacular growth in global living standards over the past 200 years. Today, public ownership of shares is under significant pressure on a number of fronts...

Steven N. Kaplan is the Neubauer Family Professor of Entrepreneurship and Finance at the University of Chicago Booth School of Business; Morten Sorensen is Associate Professor of Finance at Dartmouth University Tuck School of Business; and Anastasia Zakolyukina is Associate Professor of Accounting at the University of Chicago Booth School of Business. This post is based on their recent paper , forthcoming in the Journal of Financial Economics...

Dan Konigsburg is Global Corporate Governance Leader, Sharon Thorne is Deloitte Global Board Chair, and Stephen Cahill is Vice Chairman, Deloitte LLP. This post is based on their Deloitte memorandum. Introduction Today, a climate of dynamic, shifting expectations among investors is changing the corporate landscape. Investors are stepping up their engagement and raising their voices through policy and voting as they seek to influence corporate policies, mindsets and activities...

On October 7, 2021, BlackRock, the world’s largest asset management firm, announced that it has launched an initiative to provide its institutional clients, such as pensions and endowments, the opportunity to make their own voting decisions on proxy matters tied to their investments...

The analysis is based on recently filed proxy statements and complemented by the review of organizational documents (including articles of incorporation, bylaws, corporate governance principles, board committee charters, and other corporate policies made available in the Investor Relations section of companies’ websites)...