n will set this week on the special voting rights held by the four founders of Alimentation Couche-Tard Inc., leaving the Canadian convenience store giant more exposed to investor pressure than ever before. Its fate will be closely watched by both critics and defenders of dual class share structures. Laval, Que.-based Couche-Tard is one of […]

Since the publication in 1932 of Berle and Means’ The Modern Corporation and Private Property, “capitalist” societies have been engaged in a forlorn quest for an appropriate definition of the role, justification and “raison d’être” of large corporations. Except for the legal fiction of shareholders as owners, corporations of the 1950’s, 60’s and 70’s, were […]

Alimentation Couche-Tard Inc. will let the sun set on the special voting rights held by its four founders. Executive chairman Alain Bouchard says that he and the three other men who built the Canadian convenience-store empire will let their 25-year-old special stock rights, which give them control over the company, expire next year as scheduled […]

Institutional investors are howling for US public companies to focus more on the long-term.[1]  This is unsurprising. Long-term focused companies produce significantly better results over time, reporting far greater revenue growth with less volatility, far higher levels of economic profit, and greater total return to shareholders.[2] So if you are holding stock for a long time, a […]

CPPIB is backing a proposal to end Bombardier Inc.’s dual class share structure and remove the control of the founding family, forcing the company onto the defensive as it hosts investors for its annual meeting Thursday. Canada Pension Plan Investment Board, which oversees assets worth about $368-billion and is one of Bombardier’s 25 biggest shareholders, […]

Investor-rights group Médac acknowledges its bid to end Bombardier Inc.’s dual-class share system is destined to fail, but says it has no better option to trigger a discussion on what it sees as a critical issue. The Montreal-based organization is calling for changes to the laws governing Canadian companies that give extra voting rights to […]

When shareholders of Canada’s big banks opened their proxy voting forms in early 2008, they found a striking new proposal on the ballot. Submitted by a small ethical mutual fund company, the resolution called on banks to give investors an annual vote on how executive pay was designed. Bank boards initially opposed the motion as […]

The corporate hunting season is officially underway, an annual ritual during which shareholder parties, armed with proxies and other weapons of democratic destruction, set out to bag executives and directors for failing to deliver. The list of potential corporate failings is all encompassing. Anything and everything is a target, from executive compensation to diversity policies […]

A highly standardized process leads to yearly executive pay packages which combine salary, bonuses, stock options, restricted stock grants, performance share units, retirement benefits. The full assemblage will also include formal contracts covering change-of-control situations, termination conditions, etc.  Only the quanta of the compensation package vary from firm to firm. Whenever “long-term” performance objectives are […]

Pershing Square, an activist hedge fund owned and managed by William Ackman, began hostile maneuvers against the board of CP Rail in September 2011 and ended its association with CP in August 2016, having netted a profit of $2.6 billion for his fund. This Canadian saga, in many ways, an archetype of what hedge fund […]

“WILMINGTON, Del.—Ron Ozer was thrilled to get a job with DuPont, the two-centuries-old chemical company, when he finished his Ph.D. from Cornell in 1990. It was the place to go for young, ambitious chemists; it offered salary and benefits so generous that some people called it “Uncle Dupey.” For 26 years, he invented things for […]

The practice of a non-binding say-on-pay vote by shareholders spread quickly and broadly. It seemed that, finally, shareholders would be given the opportunity to express their dissatisfaction with outrageous or ill-conceived compensation packages. The practice, at first, was voluntary with companies agreeing to submit their compensation policies to a vote. Then, as the number of […]

The performance of controlled companies has been a contentious issue. For different reasons, various parties have worked hard at convincing the investor class that capital structures other than one-share, one-vote would produce inferior results for shareholders. Consequently, most investment funds frown upon such structures, at best tolerate them, and, at worst, have adopted policies of non-investment in these companies. […]

“Yvan Allaire and François Dauphin cogently analyze the costs and risks of proxy access, arguing that “Anyone believing that this process is likely to produce stronger boards in the long run needs to consider anew the calculus of current and prospective board members, the actions, likely dysfunctional, of people facing the humiliation (and economic loss) […]

In an October 2015 post, I posed the question: Will a New Paradigm for Corporate Governance Bring Peace to the Thirty Years’ War? As we approach the end of 2015, I thought it would be useful to note some of the most cogent recent developments on which the need, and hope, for a new paradigm […]

There is a frenzied rush for shareholders to get a new ‘right”, the right to put up their own nominees for board membership. Boards of directors, so goes a dominant opinion, are not to be fully trusted to pick the right kind of people as directors or to shift the membership swiftly as circumstances change. […]