The Conference Board uses cookies to improve our website, enhance your experience, and deliver relevant messages and offers about our products. Detailed information on the use of cookies on this site is provided in our cookie policy. For more information on how The Conference Board collects and uses personal data, please visit our privacy policy. By continuing to use this Site or by clicking "OK", you consent to the use of cookies. 

27 Aug. 2010 | Comments (0)

The enhanced disclosures in the 2010 proxy statements of some of the largest U.S. companies, including some financial institutions, reflect the beginning of a new tighter corporate governance regulatory regime that will only grow as the Dodd-Frank Act is enacted. That is one of the observations made in a four-part series of Director Notes that are based on an analysis of the 2010 proxy statements of the 30 companies in the Dow Jones Industrial Average by The Conference Board Governance Center and Davis Polk & Wardwell LLP. The four-part series focuses on disclosures in such corporate governance areas as The Role of the Board in Risk Oversight (DN-010), Board Leadership Structure (DN-011), Board Diversity and Director Qualifications (DN-012) and Compensation-Related Risk and Compensation Consultants (DN-013). [Conference Board members can download the reports for free.] “Passage of the Dodd-Frank Act will further the transformation of U.S. corporate governance from a board-centered to a shareholder-influenced model,” said Matteo Tonello, director of corporate governance research at The Conference Board. “Since additional disclosure requirements are the centerpiece of this new model, it is critical for corporations to benchmark their practices against those of their peers and adhere to the highest emerging standards of transparency. With this series, The Conference Board continues to fulfill its promise to help member companies meet these challenges.” [Read press release.] Some of the findings from the research include: •    Risk oversight models vary, but boards tend to directly review strategic risk issues. •    Non-financial companies typically report having a dedicated Chief Risk Officer. •    The CEO/chairman combination remains the prevalent leadership structure in the Dow 30. •    Specific industry expertise is cited as critical in director selection, and all companies say they consider diversity when identifying director nominees. •    Companies recognize a correlation between top-executive compensation and risk behavior, using an array of measures to mitigate such risk including clawbacks and stock-holding guidelines. •    A number of non-financial companies retain compensation consultants through their governance, rather than compensation, committees. •    Compensation consulting fees can be small relative to other disclosed fees paid to the same consultants for, e.g., actuarial or HR services. “For financial companies, overseeing risk management has long been understood to be a critical board role,” says Louis L. Goldberg, partner at Davis Polk and co-author of three of the reports. “Not surprisingly, in the wake of recent corporate crises, the business community is recognizing that risk oversight is a quintessential function for boards of non-financial companies as well.”
  • About the Author:Gary Larkin

    Gary Larkin

    Gary Larkin is a research associate in the corporate leadership department at The Conference Board in New York. His research focuses on corporate governance, including succession planning, board compo…

    Full Bio | More from Gary Larkin

     

0 Comment Comment Policy

Please Sign In to post a comment.

    Subscribe to the Governance Blog
    SUBSCRIBE

    OTHER RELATED CONTENT

    RESEARCH & INSIGHTS

    Proxy Voting Analytics (2016-2019)

    Proxy Voting Analytics (2016-2019)

    December 19, 2019 | Research Report

    The Conference Board Economics Watch<sup>®</sup> European View

    The Conference Board Economics Watch® European View

    December 18, 2019 | Economics Watch Reports

    WEBCASTS

    CONFERENCES & EVENTS

    Performance Management Conference

    Performance Management Conference

    December 08 - 09, 2020 | (New York, NY)

    2020 Succession Management Conference

    2020 Succession Management Conference

    November 05 - 06, 2020 | (New York, NY)

    The 2020 Executive Compensation Conference

    The 2020 Executive Compensation Conference

    October 22 - 23, 2020 | (New York, NY)

    Global Horizons

    Global Horizons

    October 06 - 07, 2020 | (Holborn, London)

    COUNCILS

    BLOGS

    PRESS RELEASES & IN THE NEWS