Corporate Governance Research and Resources

i. Introduction SquareWell published the inaugural edition of “What do Shareholders Propose“, a comprehensive review of all shareholder proposals related to environmental, social, and governance (“ESG”) topics in Europe and the United States for 2022 and 2023, including the “Anti-ESG” movement. The full paper can be downloaded from here. Broadly speaking, shareholder proposals can either […] Read more
2024-04-16
The Chinese stock market started in 1990 with the establishment of two domestic stock exchanges (the “A share” market): the Shanghai Stock Exchange (SSE hereafter) and the Shenzhen Stock Exchange (SZSE). The number of listed firms has been growing since then, with more than 5,000 firms now listed in the two exchanges and the newly […] Read more
2024-04-16
Introduction The rapid escalation in the frequency and severity of cyber incidents has positioned cyber risk as one of the foremost challenges confronting boards. With cyber threats becoming increasingly sophisticated and pervasive, boards are under mounting pressure to effectively address cybersecurity risks to safeguard their organizations’ interests. With projected financial losses from data breaches estimated […] Read more
2024-04-16
Statistics released by the Social Science Research Network (SSRN) indicate that, as of the end of 2023, Harvard Law School Corporate Faculty featured prominently on SSRN’s law author rankings. These professors captured seven of the top 100 slots among the top 100 law authors in all legal areas in terms of citations to their work. Professor Lucian […] Read more
2024-04-15
Two developments have transformed the detection of corporate fraud since the global financial crisis: the SEC whistleblower bounty program (WBP) and the rise of activist short sellers. Considered separately, these are generally understood to be two valuable innovations that help detect and deter fraud. But, it turns out, they are not so separate. In a […] Read more
2024-04-15
The Securities and Exchange Commission (SEC) adopted its long-awaited climate disclosure rules on March 6, 2024. (For more information, see our recent Cooley client alert, webinar and resource page.) The final rules require US domestic companies and foreign private issuers (FPIs) to disclose qualitative and quantitative climate-related information in their registration statements and periodic reports in general alignment with […] Read more
2024-04-15
In In re Match Group, Inc. Derivative Litigation, the Delaware Supreme Court answered some important questions about the standard of review applicable to conflicted transactions under Delaware law.  The first question relates to the application of the model used in Kahn v. M & F Worldwide Corp., commonly referred to as the “MFW framework.” In that 2014 case, the Delaware Supreme Court held that, instead of the more stringent “entire fairness” standard of review that would ordinarily apply in the context of mergers between a controlling stockholder and its corporate subsidiary, the business judgment standard of review should govern “where the merger is conditioned ab initio upon both the approval of an independent, adequately-empowered Special Committee that fulfills its duty of care; and the uncoerced, informed vote of a majority of the minority stockholders.” The question remained, however, whether, in the context of conflicted controlling stockholder transactions that do not involve freeze-out Read more
2024-04-15
Source: Cooley
As we gear up for the 2024 proxy season, it’s important to temper our expectations for any major surprises. The trends we’ve seen in recent years are likely to continue, effectively establishing the past couple of years as the new normal. Shareholder proposal support is likely to remain subdued. Activist campaigns for board seats will […] Read more
2024-04-14
Each year in our Annual Memo series, White & Case’s Public Company Advisory Group provides practical insights on preparing Annual Reports on Form 10-Ks, Annual Meeting Proxy Statements and, for FPIs, the Annual Report on Form 20-F. This installment of our Annual Memo will focus on key considerations for 2024 Annual Meeting Proxy Statements in three subsections: […] Read more
2024-04-13
According to Griffin, Kruger, and Maturana (JFE, 2021), “ten years after the financial crisis, the central question of what explains the rise and fall in house prices remains unresolved.” In “Creditor Rights, Collateral Reuse, and Credit Supply” (JFE, 2024), I seek to address this central question by critically analyzing the contribution of the Bankruptcy Abuse Prevention and Consumer […] Read more
2024-04-12
Proposed Amendments to DGCL on Stockholder Contracting Would Create More Problems Than They Purportedly Solve Posted by Sarath Sanga (Yale) and Gabriel Rauterberg (University of Michigan), on Friday, April 5, 2024 Tags: amendments, delaware, DGCL, moelis, stockholder contracting A Deeper Dive into the SEC’s Landmark Climate Disclosure Rules for Public Companies Posted by Matthew Morreale, […] Read more
2024-04-12
Globalization, whatever its problems, has created international flows of goods and other items that in value far exceed the GDP of the largest states (or combinations of them like the EU). and so it may lay claim to its own … Read more
In the important 2014 case of Kahn v. M & F Worldwide Corp., the Delaware Supreme Court held that freeze-out mergers, in which a controlling stockholder takes a company private, are subject to Delaware’s heightened “entire fairness” standard of … Read more
Key Takeaways Only about 15% of companies in the S&P 500 provide some disclosure in proxy statements about board oversight of AI. Disclosure of board oversight of AI and directors’ AI expertise is primarily found in the information technology sector, with 38% of companies providing some level of board oversight disclosure. 13% of S&P 500 […] Read more
2024-04-11
How should investors behave in the face of climate–related risks and the energy transition to a low carbon world? To answer this question, it is important to recognize that accounting for climate risks in investment decisions brings investors both benefits and costs. On the one hand, shunning carbon–intensive, “brown” assets can reduce an investor’s exposure […] Read more
2024-04-11
FEP and Its Goals The authors of this piece represent the Free Enterprise Project of the National Center for Public Policy Research (FEP), which has for nearly 20 years represented the interests of the center/right majority of Americans against ESG efforts that became more coordinated, better funded and more aggressively left-partisan in each of those […] Read more
2024-04-11
At a glance We briefly review key takeaways from the US proxy season in 2023, which included a record number of shareholder proposals going to a vote and a rise in anti-ESG shareholder proposals. Looking into 2024 we expect the Universal Proxy Card rule to increasingly influence boards around board quality and shareholder rights. We […] Read more
2024-04-10
How does the Global South relate to the global debates on corporate governance? Studies in this area, like their counterparts in other areas of law, have traditionally focused on a handful of usual suspects from the Global North, thereby neglecting most of the world. The Global South, here understood as a synonym for developing countries, […] Read more
2024-04-10
In holding that certain provisions within the stockholder agreement of a Delaware corporation are invalid under the Delaware General Corporation Law (DGCL), the Delaware Court of Chancery has created a framework for evaluating whether an agreement impermissibly restricts the authority and duty of directors to manage the business and affairs of the corporation in their […] Read more
2024-04-10
The Harvard Law School Forum on Corporate Governance published a total of 647 posts during 2023, and its readership has continued to display steady growth, including: Attracting more than 200,000 unique readers a month; Having visitors to the Forum coming from 233 countries and territories during the year; and Attracting more than 4.1 million page […] Read more
2024-04-09
Foundational theories of the firm suggest that (1) shocks to expected cash flows influence shareholder preferences toward corporate risk-taking, and (2) shareholders may respond by altering the risk-taking incentives contained in the compensation packages they give to their executives. For example, shocks that lower expected cash flows might lead shareholders to prefer that their firms […] Read more
2024-04-09
On March 18, 2024, the SEC announced settled charges against two investment advisers for making false and misleading statements about their use of artificial intelligence (“AI”), which the SEC refers to as “AI washing.” By analogy, the SEC has pursued “greenwashing” cases in connection with false and misleading statements about ESG, which has been anticipated […] Read more
2024-04-09
The Delaware Supreme Court, in In re Match Group Deriv. Litig., C.A. No. 2020-0505 (April 4, 2024), has held that the test of entire fairness—Delaware’s most stringent standard of review—applies whenever a controlling stockholder stands on both sides of a transaction, absent the procedural protections contemplated by Kahn v. M&F Worldwide Corp. (Del. 2014). The […] Read more
2024-04-08
There’s an old and venerable way of talking about corporate fiduciary duties that maintains that they are owed to the corporate entity itself. Sometimes this way of talking about fiduciary duties is embraced by advocates of stakeholder value maximization in support of their position, with their sparring partners on the shareholder-value side of the continuum […] Read more
2024-04-08
What Changed? Friendly, board-supported M&A transactions, are routinely being challenged by shareholders. While this is not a new phenomenon, the frequency and organized public nature of shareholder opposition to announced transactions has caught many public companies by surprise. In the past, institutional shareholders unhappy with a deal might have just sold their shares or privately […] Read more
2024-04-08
For many business economists and legal academics, the purpose of any business organization is simply stated: to maximize profits. And it is true that many practical advantages may follow from this statement of purpose. Focusing only on profit-making allows leaders … Read more
When finalizing proxy materials for annual shareholder meetings, companies should consider the following areas, which are described in more detail below: SEC Proxy Filing Requirements Proxy Statement Disclosures and Tagging Requirements Website and Submission Requirements Post-Meeting Requirements SEC Proxy Filing Requirements File Proxy Card, Notice of Internet Availability and Other Soliciting Materials With the SEC. […] Read more
2024-04-07
On March 6, 2024, the Commission promulgated amendments to its rules that will require registrants to provide certain climate-related information in their registration statements and annual reports (“Final Rules”). Between March 6 and March 14, 2024, petitions seeking review of the Final Rules were filed in multiple courts of appeals. On March 8, 2024, petitioners […] Read more
2024-04-06
In Ap-Fonden v. Activision (Feb. 29, 2024)—a decision that came as a surprise to practitioners, and has far-reaching consequences—the Delaware Court of Chancery held that common practices the board of Activision Blizzard, Inc. (the “Company”) followed in approving its October 2023 merger with Microsoft Corporation may not have complied with technical requirements in the Delaware […] Read more
2024-04-06
Introduction As we previously reported, on March 6, 2024, the Securities and Exchange Commission (the “SEC” or the “Commission”) adopted (in a three-two vote) long-awaited climate-related disclosure rules for public companies (the “Final Rules”). The Final Rules, although not as prescriptive as the rules that were proposed almost two years prior (the “Proposed Rules”), contain […] Read more
2024-04-05

Governance FAQs

Director Overboarding

Director overboarding continues to be a key factor that shareholders — and those who advise them — look at when evaluating nominees at the annual shareholder vote. This brief overview of “director overboarding” will look at what it is, why it matters, and how it is evaluated.

Know Who Drives Return

Revolutionary quantitative assessments of officers and directors