Nell Minow's 8-Point Plan for Better Governance
Longtime activist for shareholder rights Nell Minow has an eight-point plan for President-elect Barack Obama.
The editor of The Corporate Library believes that Obama will have very little time and that the financial crisis shows a need for better corporate governance that "has never been clearer or more pressing."
Her recommendations:
- "Say on Pay," introduced by Sen. Obama, will get the support it needs.
- Shareholders, not management, should choose in which states the corporation is registered. Doing so will encourage state regulators to protect shareholders, not management.
- Directors should be approved by a majority vote. Current law should be changed that allows directors to serve if they do not get a majority vote provided they have no competition.
- Be savvy about appointments of the new Securities & Exchange Commission chief and key spots at the Departments of Treasury and Labor.
- Reorganize the SEC and the Commodities Futures Trading Commission in ways that stem "self regulation" of industry.
- Pressure should be brought on investors, notably big institutions, to defend why they don't demand better performance of firms.
- The SEC should be more innovative with regulation in a "comply or explain" way that takes advantage of advanced technology in reporting systems.
- More global coordination is needed.