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RiskMetrics Group Studies Find an Increase in Shareholder Activism and Litigation as a Result of the Credit CrisisSubmitted by: Sarah Cohn, Marketing

As the credit crisis evolves, the financial community is focusing on the corporate governance implications, especially board structure, oversight and risk management disclosure practices, and how the crisis is prompting a wave of securities litigation.

RiskMetrics Group today published two separate studies examining shareholder responses to the subprime credit crisis. The first report, Credit Crisis and Corporate Governance Implications, identifies the corporate governance factors involved in the credit crisis, how stronger provisions might have mitigated investor risk, and the ways investors are evaluating boards? risk management and disclosure practices. The second report, The Subprime Meltdown Heads to Court, follows the consequences of weak risk oversight, providing an overview of the wave of securities litigation and regulatory enforcement actions beginning to swell. A major finding from both reports is that shareholder activism and litigation has increased as a result of the credit crisis.

To help investors better understand the implications of the credit crisis, RiskMetrics Group has created an educational resource center here. The center contains both reports as well as other information related to the current credit crisis. RiskMetrics Group will also share the findings from both reports in a special forum, Subprime Litigation and Liability, on April 11, 2008 at 11 a.m. EDT. To register for the forum, please visit here.

Full post as published by Institutional Shareholder Services -- Corporate Governance Blog on April 09, 2008 (boomark / email).