In-House Counsel

What exactly is corporate governance and how does it differ from the corporate secretary role?

By Rees Morrison

Those who are responsible for corporate governance concern themselves with, among other issues, whether Board committees are made up of independent directors or whether a director has some relative who works for the independent auditor. More comprehensively, Corp. Sec., Issue 54, June 2008 at 28, lists governance concerns under six broad topics. I have quoted them below.

1. Board (annual director elections, board size, compensation and director independence)

2. Capital/restructuring (dual class stock, merger/acquisition, recapitalization and stock split)

3. Compensation (incentive bonus plans, pay for performance, severance/employment agreements, executive competence incentives)

4. Routine and miscellaneous (administrative charter/bylaw changes, annual meetings, audit fees and reincorporation)

5. Social/environmental (animal welfare, climate change, sustainability reporting and workplace diversity)

6. Shareholder rights and defenses (Cuba to voting, minority shareholder rights, shareholder ability to remove directors in shareholder rights plan).

Superficially put, corporate secretaries pay attention to keeping the company and its subsidiaries in compliance with registration and corporate-procedure rules Corporate secretary II (See my post of Aug. 12, 2008: corporate secretary with 21 references.).

Full post as published by Law Department Management on October 10, 2008 (boomark / email).