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Corporate Governance

Investor perspectives

The economic downturn has amplified pressure for corporate performance that, when coupled with dynamic regulatory requirements and enhanced focus on corporate governance, is changing how companies and investors view shareholder engagement.

Companies are interacting with their owners in new and varied ways:

  • Written disclosures, particularly those relating to risk oversight and executive compensation, have changed dramatically.

  • Proxy voting, particularly the role and influence of proxy advisers, is a subject of intense debate.

  • More investors seek dialogue with directors and some directors reciprocate, believing that investor conversations offer perspectives unavailable elsewhere. The result is a movement to create a more robust role for board members to engage shareholders directly.

There is a broad spectrum of views on issues surrounding shareholder relations. To determine a way forward, Tapestry's corporate governance networks and initiatives have addressed the subject with directors, investors, and experts. 

EXPLORE THIS ISSUE:

  • Board-shareholder engagement

    Two guests from the investor community joined audit committee chairs for a discussion of board engagement with shareholders. Both boards and shareholders stand to gain from deeper engagement, and both should reach out to the other. The investor guests also said that they are interested in more information on audit-related issues.

  • Positive contact: board-shareholder engagement

    The question of how corporate boards of public companies should engage with shareholders may be front-and-center, but it is hardly new. "We are marching toward the inevitable – greater communication between boards and investors – and what we need is a new set of protocols by which boards and investors can engage and communicate."

  • A dialogue with institutional investors

    Directors face increasing pressure to meet directly with their companies' largest institutional shareholders. Lead Director Network members met with Shawn Johnson of State Street Global Advisors and Richard Breeden of Breeden Capital Management to discuss the upswing in board-shareholder engagement, topics for board-shareholder discussion, and the benefits and risks of direct engagement. Members and guests concluded by identifying effective board-shareholder engagement practices.

  • Advancing board-shareholder engagement

    Tapestry convened a meeting of four large, North American institutional investors and five experienced non-executive directors of major, global corporations to explore how corporate boards and their members engage with shareholders. The group agreed that the current model of engagement fails both boards and shareholders and that the time for improving it is at hand.

  • Dialogue with ISS President Gary Retelny

    Gary Retelny, president of Institutional Shareholder Services, separately met with Tapestry's Compensation Committee Leadership Network and Lead Director Network in the summer of 2012. The purpose of these meetings was to enable meaningful, candid dialogue on issues related to proxy advice. This ViewPoints summarizes the questions posed to Mr. Retelny and his answers.

  • Voting decisions at US mutual funds: how investors really use proxy advisers

    Conversations with North American mutual funds who collectively oversee $15.4 trillion in assets reveal the amount of internal deliberation on proxy voting decisions varies considerably among investors, and is an important factor in understanding the independence of those decisions. Proxy advisers are shown to be influential in various ways beyond the conventional wisdom that they sway vote outcomes.

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