Expert Perspective, Regulatory Updates
by Garry Rogers
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January 25th, 2011
The Securities and Exchange Commission (“SEC”) has announced its intention to consider final rules for executive compensation advisory votes an open meeting to be held on Tuesday, January 25, 2011. These rules are mandated by the Dodd-Frank Act, which requires all public filers to hold “say on pay” votes in 2011. Shareholders must be given the opportunity to advise companies whether future pay votes should occur every one, two or three years.
According to Grahall’s Garry Rogers: “The final rules are not likely to contain any real surprises, but of particular interest will be whether exemptions for ‘small-companies’ and for new issuers will survive.” Rogers adds that during the comment period, investors generally opposed this exemption while the smaller filers are pushing hard for adoption.
Click here to read the entire article regarding Say on Pay in Grahall’s Knowledge Center.
You can peruse other compliance and regulatory updates in Grahall’s Knowledge Center.
And you can contact Garry Rogers at Garry.Rogers@grahall.com.
Filed under: Expert Perspective, Regulatory Updates
Tags: Say on Pay
Expert Perspective
by Edie Kingston
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January 18th, 2011
Expert Perspective from Grahall’s OmniMeida Editorial Board
There are two paths to profitability: growth and cost reduction. In the financial services industry especially (all though not exclusively) where compensation cost might represent 50% or more of expenses, cost reduction in the manner of headcount reductions can be an effective approach to corporate revitalization.
Continue reading ““If something cannot go on forever, it will stop.” Herbert Stein” »
Filed under: Expert Perspective
Tags: Business Strategy, unemployment
Expert Perspective
by Michael Dennis Graham
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October 18th, 2010
Expert Perspective from Grahall’s Editorial Board
A couple of points in Gary Hamel’s sales pitch (for Umair Haque’s new book, “The New Capitalist Manifesto: Building a Disruptively Better Business”) disguised as a treatise on the threats to capitalism (Capitalism is Dead. Long Live Capitalism, September 21, 2010 Wall Street Journal) caught the attention of our Editorial Board.
Continue reading “The Business of Business is Business” »
Filed under: Expert Perspective
Tags: executive pay, stakeholers
Expert Perspective
by Garry Rogers
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September 7th, 2010
Expert Perspective from Grahall’s OmniMedia Editorial Board
At the risk of going “off the ranch” and getting into topics that are fraught with politics, our Editorial Board reviewed and discussed Robert Barro’s August 30, 2010 article for the Wall Street Journal (The Folly of Subsidizing Unemployment).
Mr. Barro had much blame to pass around for the continuing high unemployment in the US, landing most squarely on “the expansion of unemployment-insurance eligibility to as much as 99 weeks from the standard 26 weeks.”
This may be an argument that only history will be able to resolve. But from a “compensation” perspective, unemployment checks are a form of incentive pay.
Continue reading “Unemployment: Who or What is to Blame?” »
Filed under: Expert Perspective
Tags: severance, unemployment
Expert Perspective
by William Byrnes
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September 7th, 2010
Expert Perspective by Grahall’s OmniMedia Editorial Board
Graham Browley writes in his August 21, 2010 article for the New York Times
(In Striking Shift, Small Investors Flee Stock Market) that “The notion that stocks tend to be safe and profitable investments over time seems to have been dented in much the same way that a decline in home values and in job stability the last few years has altered Americans’ sense of financial security.”
This recession has been unusually deep, with unemployment remaining stubbornly high as companies lay off workers and jobs move overseas to cheaper labor markets. It’s not your “grandmother’s recession” (of the 1960s) or even your “mother’s recession” (of the 1980’s) for that matter. In this one, the marked difference is that, from the late 1980s on, more and more Americans became investors in the stock market through their 401(k) plans.
Continue reading “Our Notions on Investing – Getting a Little Banged Up?” »
Filed under: Expert Perspective
Tags: 401(k), INVESTING, Job Postings, unemployment
Expert Perspective
by William Byrnes
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August 31st, 2010
Expert Perspective by Grahall’s OmniMedia Editorial Board
In her August 3rd article for SHRM (Executive Search Heats Up in Emerging Markets), Stephanie Overman writes: “Executive search experts see their business heating up in emerging markets, particularly in the Asia-Pacific area and Brazil.”
Here in the US things are a bit different. With the economy still struggling to recover in many sectors and geographies, recruiting professionals can be faced with sifting through hundreds or even thousands of resumes for every job posting. “Using electronic media and social networking” as Overman writes, might work where demand is greater than supply. But for US companies the need for experienced executive search firms remains critical, regardless of how appealing these “no or low” cost options might sound.
Continue reading “It’s Not Just Executive Search, it’s Executive FIND” »
Filed under: Expert Perspective
Tags: executive search, Job Postings
Expert Perspective
by Garry Rogers
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August 24th, 2010
Expert Perspective by Grahall’s OmniMedia Editorial Board
Well, Ed Whitaker didn’t last too long as GM’s CEO, but now we are told that was all part of the plan. Whitaker will be replaced on September 1 by GM Board member Daniel Ackerson.
Perhaps we were expecting more, or more time, when it was reported in January 2010 that Whitaker, then interim CEO, was to be the “permanent” CEO of GM.
That term “permanent” made us think that he might have had more staying power than his predecessor, Fritz Henderson, who was “on the job” from March 31 to December 1, 2009. But then Fritz was “permanent” too until the GM Board, led by new Chairman Edward Whitaker, became concerned “… about whether G.M. can overhaul its corporate culture and make a fresh start under a holdover executive like Mr. Henderson, who has worked for the company for 25 years.” (New York Times December 2009).
Of course all of this changing of the guard at GM started with the departure of Rick Wagoner at the behest of President Barack Obama when it became clear that GM would need to file for Chapter 11 Bankruptcy protection as a result of the 2008/2009 economic downturn. This required taxpayer largess of $50 billion in aid to help the company remain solvent and changed GM from General Motors more to Government Motors.
So what’s in store for Ackerman, and will he be the permanent “permanent CEO” or continue the trend of his two predecessors and be looking for a job come the spring of 2011?
Continue reading “What Goes Around Comes Around” »
Filed under: Expert Perspective
Tags: CEO, corporate governance, GM
Expert Perspective
by Michael Dennis Graham
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August 17th, 2010
Expert Perspective: Health Care Reform
Since late March of this year when the Health Care reform bill because law Americans have been wondering just who will be the winners and who will be the losers from this “sweeping piece of social legislation.” (Time Magazine, March 23, 2010). In his recent article for Heath Care Reform Magazine The Winners & Losers of Healthcare Reform Steve Karp begins to help us understand the answer to this question. Read Steve’s article to find out where you and me along with American businesses, politicians, and the health care industry fall in the “win and lose” columns.
Continue reading “The Winners & Losers of Healthcare Reform—a Preliminary View by Steve Karp” »
Filed under: Expert Perspective
Tags: Health Care Reform
Expert Perspective
by Michael Dennis Graham
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July 20th, 2010
Expert Perspective by Grahall’s OmniMedia Editorial Board
Kevin Crowley’s July 12th article in Bloomberg announcing the planned acquisition of Hewitt Associates by Aon (Aon to Purchase Hewitt for $4.9 Billion in Cash, Stock) sparked a lively conversation amongst our Editorial Board members. Aon is, as Crowley says: “…the world’s largest insurance broker” and Hewitt “…provides payroll and consulting services to 3,000 clients.”
Upon the announcement, Aon’s shares initially dropped by 10% but both Aon’s and Hewitt’s stock prices are up slightly for the week. For Aon, this result might be based on the strength of an upgraded rating from “hold” to “buy” by Bank of America Merrill Lynch analyst Jay Cohen.
But other than some possible anxiety on the part of Aon shareholders, what does this acquisition suggest?
Continue reading “Caveat Emptor” »
Filed under: Expert Perspective
Tags: consulting firms, mergers and acquisitions
Expert Perspective
by Michael Dennis Graham
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April 12th, 2010
Expert Perspective by Grahall’s OmniMedia Editorial Board
Margaret E. Tahyar (partner and member of the New York Financial Institutions Group at Davis Polk & Wardwell LLP) posted a blog on March 21, 2010 on the Harvard Law School Forum on Corporate Governance and Financial Regulation (“RiskMetrics’ Introduces New Governance Measurement for Proxy Voting Reports”). In her blog, Tahyar said: “RiskMetrics Group (RMG) has recently overhauled its core corporate governance yardstick… The Corporate Governance Quotient (CGQ), which for the past several years has ranked companies, both within their industry and on a broader basis, according to their overall adherence to RMG’s notions of governance best practices, is being discontinued as of June 2010. RMG is adopting a new approach as of March 2010 called Governance Risk Indicators (GRId), which will be applied to all of the 6,400 U.S. companies that it reviews. Under the GRId system governance practices will be grouped into four headings — Board Structure, Shareholder Rights, Compensation and Audit — and a color-coded risk assessment — High, Medium or Low Concern — will be applied to each category for each company. These assessments will be made on an absolute rather than a relative basis.”
Risk Metrics’s ISS division created CGQ in 2002 and it has since become well known and well recognized if not well understood. At the time, it was an important step forward in helping investors understand the organization and structure of boards, company control and their relationship to management. The methodology for CGQ was confidential and the CGQ “black box” provided companies and their investors with a number that showed how the company compared to others in that industry. Essentially, each company was “good” or “bad” compared to their peers. The rankings were perfunctory, mechanical and, other than companies on the very extremes of “good” or “bad”, the data was so highly “normalized” that everybody fell in the middle.
Continue reading “Let’s Be Absolutely Clear” »
Filed under: Expert Perspective
Tags: corporate governance
The Securities and Exchange Commission (“SEC”) has announced its intention to consider final rules for executive compensation advisory votes an open meeting to be held on Tuesday, January 25, 2011. These rules are mandated by the Dodd-Frank Act, which requires all public filers to hold “say on pay” votes in 2011. Shareholders must be given the opportunity to advise companies whether future pay votes should occur every one, two or three years.