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Posts by Gregg LaBar

Will focus on gender diversity on the Board lead to gender parity?

Much more than an emerging trend, increasing diversity on Boards of Directors has become one of the most important corporate governance issues of the 2018 proxy season. Many investors are beginning to insist on diversity, especially gender diversity, and are willing to oppose Boards and companies that cling to the status quo.

At year-end 2017, women occupied 16.5 percent of Board seats at Russell 3000 companies, according to Equilar’s Gender Diversity Index. Essentially, one of every six Board members, or two of every 12 Board members, is a female. This is up from 15.1 percent a year earlier. Equilar estimates that women are on pace to achieve Board parity by 2048.

Equilar also reported that the number of Russell 3000 Boards with no women dropped from nearly 25…

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Vanguard’s 3 emerging board themes: engagement, diversity and sustainability

The Vanguard Group, the ultimate long-term investment firm, has set clear, aggressive expectations for public companies that want its support during the 2018 proxy season and beyond. In its August 31, 2017, “open letter to directors of public companies worldwide,” Vanguard Chairman and CEO F. William McNabb III identified three emerging themes that should get the attention of just about every public company:

  1. Good governance starts with a great board,” he wrote, and boards should be “high-functioning, well-composed, independent, diverse and experienced.” He said Vanguard sees the board as “one of a company’s most critical strategic assets” and “there is a growing role for independent directors in engagement” with shareholders.
  2. Gender diversity on the Board is…
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Introducing ‘the SASB report’; JetBlue is first adopter

There is a new flavor of sustainability reporting from which to choose. JetBlue, the low-cost airline that is now the sixth-largest carrier in the United States, has piloted “the SASB report” with its 2016 report.

SASB is the Sustainability Accounting Standards Board, which was formed in 2012 to create a framework for disclosure of material sustainability factors by U.S. public companies. The intention is to create the same level of scrutiny of, and confidence in, sustainability data as has been mandated for public companies’ financial data. The SASB standards are highly targeted, with material issues specifically identified in standards for 79 industries – from Advertising & Marketing to Wind Energy. Companies in one industry, such as JetBlue, have one relatively…

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SEC chairman nominee Jay Clayton says IPO regs and costs should be eased

Jay Clayton is likely headed for a smooth confirmation by the U.S. Senate to be the new chairman of the Securities and Exchange Commission (SEC).

We already have a pretty good sense of what Clayton, a high-profile corporate attorney with Sullivan & Cromwell LLP, is likely to focus on, based on his March 23, 2017 testimony before the Senate Committee on Banking, Housing and Urban Affairs:

He said current SEC regulations have made it “too costly to become a public company,” and, as a result, there has been “a dearth of IPOs” in recent years. Clayton noted that the number of U.S.-listed public companies is down over 35 percent from 1997. In 1996, there were approximately 845 U.S. IPOs, while in 2016, there were approximately 128. Clayton’s client work has included…

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Will Trump Administration ‘dismantle’ Dodd-Frank?

On consecutive days just after the presidential election, The Wall Street Journal ran articles with the following headlines, “Donald Trump’s Transition Team: We Will ‘Dismantle’ Dodd-Frank” and “Full Repeal of Dodd-Frank Isn’t Main Focus of Trump Transition.”

And so it goes at the tail end of one of the most politically turbulent years in decades. As the focus is now shifting from politics to policy, pundits everywhere are taking their shots at reading the tea leaves and reading between the lines. In addition, it’s all happening in a real-time, social media-frenzied environment.

Enter this Dix & Eaton blog series, in which we hope to provide some context around how the key political and policy issues of the day could impact investor relations, public companies,…

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