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AT&T, Bank of America, Coca-Cola, IBM, Johnson & Johnson, P&G and Other Leaders Sign on to Updated Commonsense Corporate Governance PrinciplesCEOs of 20 leading public companies, pension funds and investment firms today have signed the Commonsense Corporate Governance Principles 2.0 ("Commonsense Principles 2.0"), committing to using these standards to inform the corporate governance practices within their own organizations. The Commonsense Principles 2.0 are meant to promote a constructive dialogue on good corporate governance to benefit the millions of Americans who work for and invest in America's public companies, create economic growth, and sustain the health of America's corporations and markets. They are an updated version of the Commonsense Principles successfully launched in 2016 to build momentum around the corporate governance conversation. List of Signers As of today's release, the following executives had signed the Commonsense Principles 2.0 and Open Letter1:
1) Names in bold type are new signatories Key Endorsements Business Roundtable and The Conference Board Governance Center have endorsed the Commonsense Principles 2.0 which build on the robust public dialogue that has taken place among key governance groups, investors and other stakeholders since the Principles were first published in 2016. Joshua Bolten, President & CEO of Business Roundtable, commented, "Business Roundtable welcomes the Commonsense Principles of Corporate Governance 2.0 and their emphasis on advancing both high ethical standards and long-term economic value creation for the American people. As the operating environment for U.S. public companies continues to evolve, it is more important than ever for corportions, CEOs and boards of directors to adopt and uphold meaningful corporate governance practices. Business Roundtable supports the leadership and forward thinking that the Commonsense Principles represent." Douglas K. Chia, Executive Director, The Conference Board Governance Center, said, "We commend and support the persistent leadership of this group to give actionable direction to boards and investors on governing corporations for the long-term benefit of their key stakeholders." A Call to Action The signers of the Commonsense Principles 2.0 are calling on all companies and institutions that believe in the cause of good governance to join their ranks by adding their names to the list of signatories. Warren Buffett, Chairman and CEO of Berkshire Hathaway, and one of the original signers, said, "Good corporate governance is critical to the success of American companies and to the American economy overall. This document takes it to another level of sound, commonsense principles that have been endorsed by multiple prominent business leaders and investors. It is a living document to help spur a larger conversation among boards, investors and companies for the benefit of all Americans." Jamie Dimon, Chairman and CEO of JPMorgan Chase and Chairman of Business Roundtable, said, "We're pleased that some of America's greatest institutions have signed on to the Commonsense Principles -- formally joining a dozen others in our efforts to promote best-in-class corporate governance. With the commitment of these additional signatories, the endorsement from the BRT (News - Alert) and The Conference Board Governance Center and support from the Millstein Center, we are working hard to promote principles that help drive the long-term strategy, healthy growth and sustainability of America's companies." Kristin Bresnahan, Executive Director of the Ira M. Millstein Center for Global Markets and Corporate Ownership at Columbia Law School, commented, "The Millstein Center is excited to host the Commonsense Principles 2.0. The Commonsense Principles 2.0 represent an important effort to bridge the divide between shareholders on the one hand, and companies and their boards on the other, to promote sound, long-term governance in our public companies." Companies and institutional investors who would like to sign on to the Commonsense Principles 2.0 can do so by emailing Ms. Bresnahan at [email protected] or at the link provided on the Millstein Center's website. Noteworthy Additions Included in in Commonsense Principles 2.0 The updated principles released today incorporate a number of additions and enhancements, including: 1) Board members should be prepared to serve for a minimum of three years. 2) If board elections are not annual, companies should explain why. 3) Companies and shareholders are encouraged to engage early on important proxy proposals. 4) Companies should allow some form of proxy access. 5) Poison pills and other anti-takeover defenses should be put to a shareholder vote and re-evaluated by the board on a periodic basis. 6) Asset managers should disclose if they rely on proxy advisors to inform their decision making. 7) Asset managers should disclose their conflict of interest policies in their proxy voting and shareholder engagement activities. 8) Portfolio managers should be compensated based on performance over an appropriate term, given the strategy and investment time horizon for the portfolio. 9) Asset owners should promote sound, long-term oriented governance in their direct interactions with both companies and asset managers. 10) Asset owners should use benchmarks and performance reports consistent with their investment time horizon to affect governance outcomes with asset managers and evaluate the asset managers' performance on both investment returns and governance. An Open Letter outlining the leaders' thinking about the evolution of the principles and the broader governance conversation and the updated principles are available at https://millstein.law.columbia.edu/content/commonsense-principles-20 and http://www.governanceprinciples.org/. View source version on businesswire.com: https://www.businesswire.com/news/home/20181018005402/en/ |
