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Program on Corporate Governance Advisory Board
- William Ackman
- Peter Atkins
- David Bell
- Kerry E. Berchem
- Richard Brand
- Daniel Burch
- Paul Choi
- Jesse Cohn
- Arthur B. Crozier Christine Davine
- Renata J. Ferrari
- John Finley
- Andrew Freedman
- Ray Garcia
- Byron Georgiou
- Joseph Hall
- Jason M. Halper
- Paul Hilal
- Carl Icahn William P. Mills
- David Millstone
- Theodore Mirvis
- Philip Richter
- Elina Tetelbaum
- Sebastian Tiller
- Marc Trevino Jonathan Watkins
- Steven J. Williams
- Daniel Wolf
HLS Faculty & Senior Fellows
Author Archives: Harvard Law School Forum on Corporate Governance and Financial Regulation
2016 Proxy Season Update
It is time for public companies to think about the upcoming 2016 proxy and annual reporting season. Preparation of proxy statements and annual reports requires a major commitment of corporate resources. Companies have to gather a great deal of information to produce the necessary disclosures. In addition, with increasing frequency, companies are choosing to implement […]
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Posted in Accounting & Disclosure, Boards of Directors, Corporate Elections & Voting, Executive Compensation, Practitioner Publications, Securities Regulation
Tagged Clawbacks, Compensation disclosure, Compensation ratios, Cybersecurity, Disclosure, Dodd-Frank Act, Executive Compensation, Hedging, Pay for performance, Proxy access, Proxy advisors, Proxy season, Proxy voting, Rule 14a-8, Say on pay, SEC rulemaking, Shareholder proposals, Shareholder voting
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The Limits of Using TSR as an Incentive Measure
The widespread and growing use of total shareholder return (TSR) as an incentive measure is not the panacea many believe it to be. To test our point of view we wanted to explore one critical question: Does the inclusion of TSR measures in long-term incentive plans result in improved firm performance? To find out the […]
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Posted in Academic Research, Accounting & Disclosure, Boards of Directors, Comparative Corporate Governance & Regulation, Empirical Research, Executive Compensation, Practitioner Publications
Tagged Boards of Directors, Compensation committees, Compensation disclosure, Executive Compensation, Executive performance, Firm performance, Incentives, Management, Pay for performance, Performance measures, Proxy advisors, Shareholder value
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Observations on Short-Termism and Long-Termism
The debate about whether U.S. public companies are afflicted by short-termism rather than more beneficial longer-term behavior and, if so, its effect on our economy is ubiquitous. It occupies increasing attention in corporate board rooms, executive suites and investment management businesses from the smallest to the largest. The debate is a commonplace topic in the […]
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Posted in Boards of Directors, Comparative Corporate Governance & Regulation, Corporate Elections & Voting, Institutional Investors, Practitioner Publications
Tagged Board communication, Boards of Directors, Engagement, Institutional Investors, Investor horizons, ISS, Long-Term value, Management, Proxy advisors, Shareholder activism, Shareholder proposals, Shareholder voting, Short-termism
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The Failure of Liability in Modern Markets
In April 2015, the Justice Department indicted Navinder Sarao—a 36 year-old trader operating out of his parents’ basement—for actions resulting in the Flash Crash in May 2010. [1] According to the complaint, Sarao’s use of fake or “spoof” orders was damaging enough to precipitate a near 1000-point plunge in in the Dow Jones Index. It […]
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Posted in Academic Research, Securities Litigation & Enforcement, Securities Regulation
Tagged Algorithmic trading, High-frequency trading, Incentives, Liability standards, Market efficiency, Misconduct, Negligence, Risk-taking, Rule 10b-5, Secondary liability, Securities enforcement, Securities regulation, Systemic risk
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Materiality as Pleading Obstacle
Claims brought under the Securities Act of 1933 (the “Act”) are typically challenging for defendants to dismiss. Some defendants may have affirmative defenses, but most of the Act’s provisions impose strict liability for alleged misstatements—meaning that a plaintiff need not plead scienter—and claims brought under the Act are subject to the relatively low pleading standard […]
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Posted in Accounting & Disclosure, Boards of Directors, Court Cases, Practitioner Publications, Securities Litigation & Enforcement, Securities Regulation
Tagged Boards of Directors, Class actions, Compliance and disclosure interpretation, Disclosure, IPOs, Liability standards, Materiality, Misreporting, Regulation S-K, SEC, Securities Act, Securities litigation, U.S. federal courts
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The SEC’s Focus on Cybersecurity
On September 22, 2015, the Securities and Exchange Commission (the “SEC”) issued a cease-and-desist order (the “Order”) and settled charges against St. Louis-based investment adviser R.T. Jones Capital Equities Management (“R.T. Jones”) for failing to establish required policies and procedures to safeguard customer information in violation of Rule 30(a) of Regulation S-P (“Rule 30(a)”) under […]
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Posted in Practitioner Publications, Securities Litigation & Enforcement, Securities Regulation
Tagged Asset management, Compliance & ethics, Cybersecurity, Investment advisers, Investor protection, Risk, Risk assessment, Rule 30(a), SEC, SEC enforcement, Securities Act, Securities enforcement, Securities regulation
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Those Short-Sighted Attacks on Quarterly Earnings
The clamor against so-called corporate short-term thinking has been steadily rising, with a recent focus on eliminating the quarterly earnings report that public firms issue. Quarterly reports are said to push management to forgo attractive long-term projects to meet the expectations of investors and traders who want smooth, rising earnings from quarter to quarter. The […]
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Posted in Academic Research, Accounting & Disclosure, Boards of Directors, Comparative Corporate Governance & Regulation, HLS Research, Op-Eds & Opinions, Securities Regulation
Tagged Boards of Directors, Corporate culture, Earnings disclosure, Financial reporting, Information asymmetries, Information environment, Investor horizons, Long-Term value, Management, Market efficiency, Short-termism, Transparency, UK
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Regulatory Approvals for Bank M&A
The Federal Reserve’s approval last week of M&T’s pending acquisition of Hudson City has prompted a great deal of speculation as to the current state of the regulatory approval process for bank mergers and acquisitions. Announced over three years ago, on August 27, 2012, the M&T/Hudson City transaction has taken longer to receive Federal Reserve […]
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Posted in Banking & Financial Institutions, Financial Regulation, Legislative & Regulatory Developments, Mergers & Acquisitions, Practitioner Publications
Tagged Banks, Dodd-Frank Act, Due diligence, Federal Reserve, Financial institutions, Financial regulation, Jurisdiction, Merger litigation, Mergers & acquisitions
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SCOTUS Declines Petition on Insider Trading Ruling
Today [October 5, 2015], the United States Supreme Court declined to hear the petition for a writ of certiorari (the “Petition”) filed by the United States Department of Justice (“DOJ”) in United States v. Newman, 773 F.3d 438 (2d Cir. 2014), a landmark decision that dismissed indictments against two insider trading defendants. By declining to […]
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Posted in Court Cases, Legislative & Regulatory Developments, Practitioner Publications, Securities Litigation & Enforcement, Securities Regulation
Tagged DOJ, Information environment, Inside information, Insider trading, Liability standards, SEC, SEC enforcement, Social networks, Supreme Court, U.S. federal courts
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Delaware’s Respect for Informed Stockholder Approval of Mergers
In an important ruling last week, the Delaware Supreme Court reaffirmed that control of Delaware companies lies in the boardroom and held that the deferential business judgment rule is the “appropriate standard of review for a post-closing damages action” when a third-party merger “has been approved by a fully informed, uncoerced majority of the disinterested […]
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Posted in Boards of Directors, Court Cases, Mergers & Acquisitions, Practitioner Publications
Tagged Board independence, Business judgment rule, Controlling shareholders, Delaware cases, Delaware law, Fairness review, Fiduciary duties, Merger litigation, Mergers & acquisitions, Minority shareholders, Shareholder suits
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