Je vous propose une lecture parue dans Harvard Law School Forum on Corporate Governance, publiée par Holly J. Gregory du « Corporate Governance and Executive Compensation group » de la firme Sidley Austin LLP.
On y décrit les priorités que les conseils d’administration doivent considérer en 2014 :
Les investisseurs institutionnels
Le conseil d’administration
La sélection du PCD, la rémunération, la relève
Les contrôles internes, la gestion du risque et la conformité
La préparation pour la gestion de crises
L’activisme et les relations avec le C.A.
La composition du C.A. et le leadership
Bonne lecture !
As the fallout from the financial crisis recedes and both institutional investors and corporate boards gain experience with expanded corporate governance regulation, the coming year holds some promise of decreased tensions in board-shareholder relations. With governance settling in to a “new normal,” influential shareholders and boards should refocus their attention on the fundamental aspects of their roles as they relate to the creation of long-term value.
Institutional investors and their beneficiaries, and society at large, have a decided interest in the long-term health of the corporation and in the effectiveness of its governing body. Corporate governance is likely to work best in supporting the creation of value when the decision rights and responsibilities of shareholders and boards set out in state corporate law are effectuated.
This article identifies and examines the key areas of focus that institutional investors and boards should prioritize in 2014.
- Apply a long-term value approach.
- Vote on a company-specific basis where possible.
- Focus on core issues.
Despite increased shareholder decision rights and influence, the board’s fundamental mandate remains to direct the affairs of the company. Key areas for boards to focus on include:
- Defining board priorities.
- Monitoring company performance and setting strategic direction.
- Selecting and compensating the CEO and planning for succession.
- Attending to internal controls, risk management and compliance.
- Preparing for a crisis.
- Engaging with shareholders and responding to shareholder activism.
- Determining board composition needs and leadership structure.
Boards determine how to apportion their very limited time based on board responsibilities and the unique needs of the company. Each board must define the priorities that will shape its agenda and determine the information it needs to govern, driven by the needs of the business. Boards add value when they help management cope with the complex context in which the company operates, and when they support management in focusing on the long-term interests of the company and its shareholders.
Active board engagement in overseeing company performance, strategy and the culture of ethics should help to align the company’s approach to compensation, financial disclosure, internal controls, risk management and compliance. Therefore, in most circumstances the majority of board time should be reserved for matters related to company performance and strategy, and the ethical tone within the company.
Outside directors require considerable amounts of information as they get to know the business and the environment in which the company operates. Active involvement in prioritizing the agenda and defining information needs positions outside directors to provide objective guidance and judgment. The board should not leave decisions about the board agenda and information needs to management alone.
Company Performance and Strategic Direction
Challenges for boards include:
- Reserving appropriate time for review and discussion of company performance.
- Taking an active role in strategic planning while maintaining objectivity. (This is especially critical in enabling the board to assess the positions of activist shareholders versus management’s plans.)
- Supporting appropriate long-term investment and prudent risk-taking in the face of significant short-term pressures for immediate returns or other conflicts.
- Balancing guidance and support of management with objective assessment and constructive criticism.
- Holding management accountable for results in light of the agreed strategy by determining and applying performance benchmarks.
- Helping management anticipate and understand the potential for abrupt and long-term changes in the company’s economic, political and social environment.
- Testing key assumptions that underpin management’s proposed strategic plans and major transactions, including assumptions about risks.
- Maintaining appropriate deference to management on day-to- day operations without becoming unduly passive.
CEO Selection, Compensation and Succession
Challenges for boards include:
- Setting goals for the CEO (and other key executives) in line with corporate strategy, objectives and plans.
- Providing appropriate support, guidance and deference to the CEO while maintaining objectivity about performance.
- Designing compensation to attract and retain talent while aligning it with performance.
- Considering the CEO’s contributions in the context of the contributions of the broader team, an issue that will be highlighted with the new pay ratio disclosures.
- Discussing management development and succession planning on a regular basis, even regarding a new, young or high-performing CEO.
- Understanding and considering shareholder views about CEO compensation and succession without substituting those views for the board’s own objective judgment.
- Ensuring that company disclosures adequately communicate the board’s views and activities regarding compensation and succession planning.
Internal Controls, Risk Management and Compliance
Challenges for boards include:
- Ensuring that appropriate time is devoted to these key issues without becoming overly focused on controls and compliance.
- Using board committees efficiently to address these issues while keeping the entire board appropriately informed and involved.
- Remaining vigilant for red flags, which are often a series of yellow flags.
- Creating incentives for management to establish and maintain an appropriate control, risk management and compliance environment.
- Ensuring that the company has adopted appropriate standards of corporate social responsibility consistent with evolving societal expectations.
- Monitoring compliance with legal and ethical standards.
Preparing For Crisis
Shareholder Engagement and Activism
Board Composition and Leadership
* En reprise