PubCo CEOs And Institutional Investors Sign Updated Common Sense Corporate Governance Principals
A little more than two years ago, a group of prominent CEOs and Institutional Investors published the Commonsense Principles of Corporate Governance. That work represented a collaborative effort – a search for common ground – by representatives of some of America’s largest corporations and institutional investors.
The authors said then, and it is no less true today, that the long-term prosperity of millions of American workers, retirees and investors depends on the effective governance of our public companies. They hoped that their Principles would be part of a larger dialogue about the responsibilities and need for constructive engagement of those companies, their boards and their investors.
According to the authors, “This dialogue is critical. In the last 20 years, we have seen a precipitous decline in the number of public companies in our country – a phenomenon that is distinctly and uniquely American. While the reasons for that decline may be complex and varied, one reason cited by a number of commentators is that our country’s public market participants are too short-term oriented, thus discouraging companies with a longer-term view from going public. We need to fix that problem, so that all Americans have the opportunity to participate in the economic growth generated by our country’s innovation and ingenuity.”
An updated 12-page document referred to as Commonsense Corporate Governance Principles 2.0 was signed by the CEOs of 13 organizations, including Berkshire Hathaway, BlackRock, General Electric, General Motors, JPMorgan Chase, State Street Global Advisors and Vanguard.
Commonsense Corporate Governance Principles 2.0 covers topics including:
Board of directors’ duties, composition and internal governance
Board of directors’ responsibilities
Shareholder rights – including that public companies should allow for some form of proxy access and that dual-class voting is ‘not a best practice’
Board leadership, including the lead independent director’s role
Management succession planning
Investors’ role in corporate governance.
Learn more HERE.