Author Archives: Harvard Law School Forum on Corporate Governance and Financial Regulation

Multiple Voting Shares and Private Ordering: Should Old Taboos Be Abolished? The Recent Italian Reform

Italian Law No. 116 of 2014 introduced several rules designed to make corporate law more flexible, create incentives to corporations to go public, and might also allow controlling shareholders and directors to entrench themselves more effectively, limiting the risk of hostile acquisitions. The new rules, which became effective a few weeks ago, are both interesting […]

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Balancing Division of Board Labor with Overall Director Responsibilities

In this year’s Foreword, Dougherty argues that an increasing complexity of corporate governance and the growing list of action items assigned to directors has led to a division of labor that leaves some directors uninvolved or unaware of important board activities and responsibilities. The Culture-Structure Interplay We tend to think of board structure in relation […]

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Does Your Executive Pay Plan Create “Drive, Discipline and Speed”?

At a recent Chief Human Resources Officer (CHRO) conference, two private equity firms’ operating partners observed that executive compensation programs in each and every company in which they invested had to be completely overhauled. “Of course,” quipped one CHRO, “all you need to do is grant large, upfront stock options as a one-time long-term incentive, […]

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Delaware Court Faults Committee Process & Advisory Work in Finding Lack of Good Faith

On April 20, 2015, the Delaware Court of Chancery entered a $171 million post-trial judgment after finding a master limited partnership overpaid for assets from its parent. In re El Paso Pipeline Partners L.P. Derivative Litig., C.A. No. 7141-VCL (Del. Ch. Apr. 20, 2015). The case concerned a 2010 “dropdown” transaction in which El Paso […]

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New Statistics and Cases of CEO Succession in the S&P 500

CEO Succession Practices, which The Conference Board updates annually, documents CEO turnover events at S&P 500 companies. The 2015 edition contains a historical comparison of 2014 CEO successions with information dating back to 2000. In addition to analyzing the correlation between CEO succession and company performance, the report discusses age, tenure, and the professional qualifications […]

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The Prudent Investor Rule and Market Risk

In a new working paper, entitled “The Prudent Investor Rule and Market Risk: An Empirical Analysis,” we examine fiduciary management of market risk. The backdrop for our study is a law reform that was meant to overcome a long tradition in fiduciary investment of equating stock with speculation. By focusing categorically on risk avoidance, traditional […]

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Expanding Oversight: SEC Proposes Amendments to Rule 15b9-1

On March 25, 2015, the Securities and Exchange Commission (“SEC” or “Commission”) proposed an amendment to Rule 15b9-1 (the “Proposal”) under the Securities Exchange Act of 1934 (“Exchange Act”) that, if adopted, would close an historical exception to the general requirement that registered broker-dealers must become members of a registered national securities association (“Association”), effectively, […]

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Conduct of Business Regulation: A Survey and Comparative Analysis

Although recent regulation and scholarship has focused on the financial stability and solvency of financial institutions, the business conduct of these institutions remains an issue of abiding regulatory concern. In a my chapter “Conduct of Business Regulation,” which is in the forthcoming Oxford Handbook of Financial Regulation, I provide a survey and comparative analysis of […]

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Regulators Working Together to Serve Investors

It is my honor to deliver the opening remarks for today’s [April 14, 2015] North American Securities Administrators Association (“NASAA”) and Securities and Exchange Commission (“SEC”) 19(d) Conference. For those who are keeping count, this is my seventh year as the SEC’s liaison to NASAA. It has been a privilege to serve you in this […]

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Market (In)Attention and the Strategic Scheduling and Timing of Earnings Announcements

In our paper, Market (In)Attention and the Strategic Scheduling and Timing of Earnings Announcements, forthcoming in the Journal of Accounting and Economics, we revisit a long-standing but still unresolved question: do managers “hide” bad earnings news by announcing during periods of low market attention? Or, conversely: do managers “highlight” good earnings news by announcing earnings […]

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