Corporate & Securities Law

RiskMetrics Issues '09 Proxy Season Policies

By broc

RiskMetrics Issues '09 Proxy Season Policies

In our "Proxy Advisors" Practice Area, we have posted RiskMetrics' new set of 2009 policies, which were released in the middle of last week. Tune in next month to hear Pat McGurn of RiskMetrics' ISS Division to discuss these new policies in this webcast: "Forecast for 2009 Proxy Season: Wild and Woolly."

RiskMetrics to Change CGQ?

Speaking of RiskMetrics, I have heard that they are contemplating an overhaul of their corporate rating service, the "Corporate Governance Quotient" (known as "CGQ"). Although their plans could change, I understand that there will not be a single numerical score as there is today. [You may recall that today, each company's CGQ score is available from their Yahoo! Finance page, among other places.]

Instead, there would be multiple scores for each company, each score dependent on a major area of governance (egs. board independence, board structure, compensation, auditing and financial integrity). The idea is to make the results less "black-and-white" and allow users to reach their own conclusions more readily.

I'm not sure if a change in methodology will make the CGQ more popular with investors - studies have shown they are not considered particularly relevant for investment decisions today - but I imagine some companies will welcome this development (particularly corporate secretaries who have directors that closely follow the scores - although I believe the number of those have dwindled over the years).

Bebchuk v. Electronic Arts: Transcript Posted

Recently, I blogged how Judge Hellerstein of US District Court (SDNY) dismissed Bebchuk v. Electronic Arts, Inc. (which involves Professor Lucian Bebchuk's attempt to use Rule 14a-8 to establish new "shareholder access" procedures). I mentioned that once we find a copy of the decision, we'd post it in our "Shareholder Proposals" Practice Area.

Apparently, the Judge didn't feel like writing a decision because he figured that the 2nd Circuit would handle that upon appeal - so we've posted his 1-page order as well as the transcript from the hearing.

- Broc Romanek

Full post as published by The Corporate Counsel.net Blog on December 01, 2008 (boomark / email).