Yearly Archives: 2025

CEO Pay Study

Posted by Amit Batish, Equilar, Inc., on
Sunday, June 8, 2025
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Amit Batish is Sr. Director of Content & Communications at Equilar, Inc. This post is based on his Equilar memorandum. The data in the study was provided by Courtney Yu, Director of Research at Equilar, Inc.

The corner offices of corporate America are home to some of the most influential executives in business today, notably chief executive officers (CEOs). The CEO’s position is the most pivotal for any corporation, driving strategy and financial growth, particularly during periods of uncertainty and transition. The leadership and steady guidance of top-performing CEOs often come at a premium, and companies have seldom shied away from offering generous compensation, despite ongoing public scrutiny.

Equilar and the Associated Press have partnered for 15 years to examine CEO compensation packages across the S&P 500. The annual study identifies trends in compensation awards for CEOs who served in that role at an S&P 500 company for at least two years as of the most recent fiscal year end. To qualify for inclusion in this year’s study, companies must have filed a proxy between January 1 and April 30, 2025. READ MORE »

Remarks by Commissioner Peirce before the International Center for Insurance Regulation

Posted by Hester M. Peirce, U.S. Securities and Exchange Commission, on
Saturday, June 7, 2025
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Hester M. Peirce is a Commissioner at the U.S. Securities and Exchange Commission. This post is based on her recent remarks. The views expressed in this post are those of Commissioner Peirce and do not necessarily reflect those of the Securities and Exchange Commission or its staff.

Thank you, Christian. I appreciate the chance to be part of this event. I must first let you know that my views are my own as a Commissioner and not necessarily those of the U.S. Securities and Exchange Commission (“SEC”) or my fellow Commissioners. Speaking of my views, they may not overlap much with those of Theodor Adorno, the famed early 20th century intellectual whose legacy is so prominent at this university. But his assertion that “progress occurs where it ends”[1] aptly describes my views of much of the global environmental, social, and governance (“ESG”) movement.

The ESG era, though marketed as progress, has harmed investors, companies, regulators, and society. Nothing is new about companies and investors taking a wide range of factors into account in deciding how to allocate capital. The materiality framework of our U.S. securities regulatory regime elicits disclosure about issues determinative to a company’s long-term financial value, including, when applicable, ESG issues. Our framework distinguishes between what is material to an investment decision and what is not material even though some investors might care deeply about it. Only the former warrants mandatory disclosure.

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Remarks by Commissioner Peirce at the Meeting of the Investor Advisory Committee

Posted by Hester M. Peirce, U.S. Securities and Exchange Commission, on
Friday, June 6, 2025
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Hester M. Peirce is a Commissioner at the U.S. Securities and Exchange Commission. This post is based on her recent remarks. The views expressed in this post are those of Commissioner Peirce and do not necessarily reflect those of the Securities and Exchange Commission or its staff.

Thank you, Brian [Schorr]. Good morning and thank you to all of the Committee members and panelists for your participation today. Your two panel discussions should be interesting, and I hope you will have a robust discussion about the draft recommendation on investment adviser arbitration.

Pass-through voting for funds arose as a response to concerns that some fund advisers seemed to have forgotten to whom voting rights belong. Advisers, for example, were signing on to pledges to vote the shares of the funds they advised in accordance with third-party principles, and some asset manager stewardship teams were making cross-complex voting recommendations without regard for disparate fund objectives. As noted in today’s meeting agenda, “[t]he right to vote at a shareholder meeting belongs to the registered shareowner under state law.”[1] In the case of investment funds, the right belongs not to the adviser and not even to the fund investors, but to the fund itself.[2]

A fund’s board may delegate voting power to its adviser, but the adviser must exercise it in the interests of that fund and that fund alone. In making the voting decision, the adviser owes a fiduciary duty to its client—the fund—not to fund investors.[3] An asset manager that advises a large passive index fund and a small environmental impact fund may be tempted to use the leverage afforded by the index fund’s large holding in a company to pressure the company to take actions that would align with the environmental fund’s objectives. Such active engagement, however, is at odds with the passivity of the index fund.[4]

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Weekly Roundup: May 30-June 5, 2025

Posted by the Harvard Law School Forum on Corporate Governance, on
Friday, June 6, 2025

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This roundup contains a collection of the posts published on the Forum during the week of May 30-June 5, 2025

Investor Views on AI Oversight: What Do Proxy Votes Tell Us?

Posted by Lindsey Stewart and River Meng, Morningstar, Inc., on Friday, May 30, 2025
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Chancery Court Dismisses Challenge to Removal of Tag-Along Rights in Healthcare Merger

Posted by Frank J. Favia Jr. and Jonathan A. Dhanawade, Mayer Brown LLP, on Saturday, May 31, 2025
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Making Sure Newly Cautious Shareholders Get the Information They Want

Posted by Brian V. Breheny, Raquel Fox, and Joshua Shainess, Skadden, Arps, Slate, Meagher & Flom LLP, on Sunday, June 1, 2025
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A Playbook for Unplanned CEO Transitions

Posted by David A. Katz, and Laura A. McIntosh, Wachtell, Lipton, Rosen & Katz, on Monday, June 2, 2025
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The Singular Role of Public Pension Funds in Corporate Governance

Posted by Jill E. Fisch (University of Pennsylvania) and Jeff Schwartz (University of Utah), on Monday, June 2, 2025
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More and Better Options: Strengthening Long-Term CEO Succession Planning

Posted by Rusty O’Kelley and Rich Fields, Russell Reynolds Associates, on Monday, June 2, 2025
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What DOJ’s New Enforcement Plan Means for Health Care Companies

Posted by Joshua Levy and Laura Hoey, Ropes & Gray LLP, on Tuesday, June 3, 2025
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The Value of Privacy and the Choice of Limited Partners by Venture Capitalists

Posted by Rustam Abuzov (University of Virginia), Will Gornall (University of British Columbia), and Ilya A. Strebulaev (Stanford University), on Tuesday, June 3, 2025
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Streamlining Sustainability Reporting: Survey Reveals Top Priorities for Corporates

Posted by Subodh Mishra, ISS STOXX, on Tuesday, June 3, 2025
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Nevada Amends Corporate Law to Attract Incorporations

Posted by David Bell, Ran Ben-Tzur, and Dean Kristy, Fenwick & West LLP, on Wednesday, June 4, 2025
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An Eras Tour of Delaware Law

Posted by Hon. J. Travis Laster, Delaware Court of Chancery, on Wednesday, June 4, 2025
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Why Women CEOs Leave Sooner – and How Boards Can Help All CEOs Thrive

Posted by Margot McShane and Hetty Pye, Russell Reynolds Associates, on Wednesday, June 4, 2025
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Court Finds Up-C Reorganization Claim Derivative

Posted by Shannon Eagan, Patrick Gibbs, and Sarah Lightdale, Cooley LLP, on Thursday, June 5, 2025
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What Newly Amended DGCL §144 Says (and Does Not Say) about Controlling Stockholder Transactions

Posted by Marcel Kahan (New York University School of Law) and Edward Rock (New York University School of Law), on Thursday, June 5, 2025
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Season-End Summary of Challenges under Rule 14a-8

Posted by Neil McCarthy, James Palmiter, and Markus Hartmann, DragonGC, on Thursday, June 5, 2025
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Remarks by Chair Atkins

Posted by Paul Atkins, U.S. Securities and Exchange Commission, on
Friday, June 6, 2025
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Paul S. Atkins is the Chairman of the U.S. Securities and Exchange Commission. This post is based on his recent remarks. The views expressed in the post are those of Chairman Atkins and do not necessarily reflect those of the Securities and Exchange Commission or the Staff.

Good afternoon and welcome to the second Investor Advisory Committee meeting of 2025, and the first of my Chairmanship. I wish I could be there with you in person. I am now in my third tour of duty at the SEC—having previously served from 1990-1994 on the staff of former Chairmen Richard Breeden and Arthur Levitt, as a Commissioner from 2002-2008, and now as Chairman. As I have said before, it is a new day at the SEC, and I look forward to working with the Committee in this important work.

Earlier this year, the Commission made a call for candidates to fill vacancies on the Committee. We received almost 200 submissions. Commission staff is now in the process of reviewing these submissions to make recommendations to the Commissioners on which candidates to interview. Hopefully, final selections will be made in time for the new members to join your next quarterly meeting in September. The substantial interest in joining the Committee demonstrates the importance of the work that all of you are doing, and I thank you for your commitment to public service.

At today’s meeting, the Committee will discuss the proxy voting process for funds and trends in pass-through voting. The topic of proxy voting, proxy advisors, and shareholder activism is extremely important to me, READ MORE »

Season-End Summary of Challenges under Rule 14a-8

Posted by Neil McCarthy, James Palmiter, and Markus Hartmann, DragonGC, on
Thursday, June 5, 2025
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Neil McCarthy is Co-Founder and Chief Product Officer, James Palmiter is CEO and Co-Founder, and Markus Hartmann is Chief Legal Development Officer at DragonGC. This post is based on a DragonGC memorandum by Mr. McCarthy, Mr. Palmiter, Mr. Hartmann, G. Michael Weiksner, Jennifer Carberry, and Nicholas Sasso.

The SEC has just completed its oversight role for the 2024/2025 season over challenges brought by companies to exclude proposals submitted by their shareholders per Rule 14a-8. What follows is a summary of the results for this season with comparisons to prior seasons.

Under Rule 14a-8, companies generally must include shareholder proposals in their proxy statements to be considered at the annual meeting. The rule, however, provides several bases for exclusion, including 13 substantive requirements that proposals must comply with to avoid exclusion – Rule 14a-8(i)(1) to (i)(13) – as well as procedural requirements for when and how they must be submitted to the companies by shareholders. The rule has a process for how companies can seek to exclude these proposals by submitting a challenge to the SEC to obtain a favorable ‘no-action letter.’ READ MORE »

What Newly Amended DGCL §144 Says (and Does Not Say) about Controlling Stockholder Transactions

Posted by Marcel Kahan (New York University School of Law) and Edward Rock (New York University School of Law), on
Thursday, June 5, 2025
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Marcel Kahan is the George T. Lowy Professor of Law and Edward B. Rock is the Martin Lipton Professor of Law at New York University School of Law. This post is part of the Delaware law series; links to other posts in the series are available here.

After a pitched battle, Delaware’s SB21 amended DGCL § 144 and became effective on March 25, 2025.  As the rhetoric recedes, we should leave the battle over its enactment behind us and look to the future: What does amended DGCL § 144 now say about controlling stockholder transactions? And to what extent does it change prior law?  The actual language of the new section, which we will call the Safe Harbor Provision, does not reflect either its proponents’ dreams nor its opponents’ nightmares.  It instead draws a distinction between statutory controllers and common law controllers and leaves Delaware’s law on the latter untouched .

The legislative synopsis for SB21 makes clear that the goal was to create “safe harbors” for interested director and controlling shareholder transactions: “Section 1 of this Act amends § 144 of Title 8 to provide safe harbor procedures for acts or transactions in which one or more directors or officers as well as controlling stockholders and members of control groups have interests or relationships that might render them interested or not independent with respect to the act or transaction.”  Law firm memos by, among others, Morris Nichols and Richard Layton and Finger, sound the same theme.  Governor Matt Meyer, in his request to intervene in the Dropbox litigation in the event that the Delaware Supreme Court accepts the certified question on the constitutionality of SB21, focuses on the same language in the original synopsis: “[A]mended Section 144 ‘provides safe harbor procedures’ for certain acts or transactions under specified circumstances.”

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Court Finds Up-C Reorganization Claim Derivative

Posted by Shannon Eagan, Patrick Gibbs, and Sarah Lightdale, Cooley LLP, on
Thursday, June 5, 2025
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Shannon Eagan, Patrick Gibbs, and Sarah Lightdale are Partners at Cooley LLP. This post is based on a Cooley memorandum by Ms. Eagan, Mr. Gibbs, Ms. Lightdale, and Bingxin Wu and is part of the Delaware law series; links to other posts in the series are available here.

On April 10, 2025, the Delaware Court of Chancery granted a motion to dismiss in a breach of fiduciary duty action arising from BGC’s conversion from an Up-C corporation to a traditional full C corporation. While multiple fiduciary duty cases involving Up-C reorganizations have been filed recently in the Delaware Court of Chancery, very few have been dismissed at the pleading stage. In dismissing the case, the court held that the plaintiff’s claim – which was styled as a direct, putative class action – was in fact derivative, and thus failed because the plaintiff neither made a demand nor attempted to plead demand futility.

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Why Women CEOs Leave Sooner – and How Boards Can Help All CEOs Thrive

Posted by Margot McShane and Hetty Pye, Russell Reynolds Associates, on
Wednesday, June 4, 2025
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Margot McShane and Hetty Pye are Co-Leaders of the firm’s Board & CEO Advisory Partners at Russell Reynolds Associates. This post is based on a Russell Reynolds memorandum by Ms. McShane, Ms. Pye, Dana Krueger, and Leah Christianson.

Women CEOs’ tenures are, on average, three years shorter than men’s. Why?

Russell Reynolds Associates has reported extensively on the common obstacles many women leaders face on their journeys to the top. Yet these obstacles don’t disappear once women make it there. This is perhaps best illustrated by data from RRA’s CEO Turnover Index, which found that, since 2018, women CEOs hold the role for an average of 5.2 years, while their male counterparts served for an average of 7.9 years—equating to men spending more than 50% longer in seat.

While there are many different reasons and contributing factors leading to a CEO’s departure, research shows that four overarching themes rise to the surface READ MORE »

An Eras Tour of Delaware Law

Posted by Hon. J. Travis Laster, Delaware Court of Chancery, on
Wednesday, June 4, 2025
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The Honorable J. Travis Laster is Vice Chancellor at the Delaware Court of Chancery. This post is based on his recent paper and is part of the Delaware law series; links to other posts in the series are available here.

In September 2024, the Journal of Corporation Law hosted a symposium in honor of the fiftieth anniversary of its founding. That happy event provided an opportunity for a keynote speech that looked back across the history of Delaware corporate law. A forthcoming article—An Eras Tour of Delaware Law—builds on those remarks.

Since Delaware became a state in 1776, there have been nine eras of Delaware corporate law: the Antecedent Era, the Charter-Mongering Era, the Quiet Era, the Responding Era, the Reformation Era, the Moderating Era, the Generative Era, the Implementing Era, and the Current Era. Each era presented the Delaware courts with different challenges. Not surprisingly, those different challenges produced different responses.

The Eras article examines those eras and the judicial responses. The tour demonstrates that Delaware has offered a principles-based system in which judges shaped corporate law by ruling on the facts of a particular case within the context of a prevailing legal environment. As Chief Justice Leo E. Strine, Jr. observed over two decades ago, Delaware’s corporation law has been “highly dynamic,” deploying principles of equity and case-specific rulings to avoid doctrinal lock-in and ossification.

This Eras article addresses each era, giving primacy to the five decades of the Journal’s existence. Over that period, the Delaware courts have confronted too many issues to cover. The Eras article prioritizes three high-profile areas: controller transactions, third-party mergers and acquisitions, and derivative actions. For each era, the article considers the rules the courts established, the results they reached, and the rhetoric they deployed.

The article reaches an unsurprising conclusion: The defining hallmark of Delaware corporate law has been its independent judiciary, adhering to the rule of law, and reaching case-specific decisions as challenges emerge and conditions change. The judge-led dynamism of Delaware corporate law has been the key to its success.

The article will be published in the Journal of Corporation Law. It is posted on SSRN and can be found here.

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