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Reforms to Board Composition and Independence and Climate Competent Governance

The Harvard Law School Forum on Corporate Governance and Financial Regulation -

Posted by Eli Kasargod-Staub and Lisa Lindsley, Majority Action, on Saturday, February 22, 2020 Editor's Note: Eli Kasargod-Staub is Executive Director and Lisa Lindsley is Director of Investor Engagement at Majority Action and the Climate Majority Project. This post is based on their Majority Action report. Related research from the Program on Corporate Governance includes Independent Directors and Controlling Shareholders by Lucian Bebchuk and Assaf Hamdani (discussed on the Forum here). Executive Summary

Climate change poses systemic risks to the global financial system and specific risks to financial institutions with exposure to the fossil fuel sector. JPMorgan Chase (“JPM”), the largest US bank, is by far the largest global lender and underwriter to the fossil fuel sector, providing nearly $196 billion in lending and underwriting in the three years (2016-2018) since the Paris Agreement was adopted in 2015. JPM is also a leading funder within many of the riskiest and most potentially harmful fossil fuel sectors, including Arctic oil and gas, tar sands, and coal mining. JPM will need to enhance its governance and management, as well as disclose and reduce its risks and financed emissions in order to protect long-term shareholder value. Thus far the company has not acted with the urgency and scale that the climate crisis requires.

JPM CEO Jamie Dimon is also the Chair of the company’s board of directors, which places the onus on the Lead Independent Director to provide the oversight and guidance that long-term shareholders require as the climate crisis escalates. However, this role is held by Lee Raymond, who is uniquely poorly qualified to provide the oversight needed to protect long-term shareholder value in the face of these risks:

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Tax and ESG

The Harvard Law School Forum on Corporate Governance and Financial Regulation -

Posted by Deborah L. Paul and T. Eiko Stange, Wachtell, Lipton, Rosen & Katz, on Saturday, February 22, 2020 Editor's Note: Deborah L. Paul and T. Eiko Stange are partners at Wachtell, Lipton, Rosen & Katz. This post is based on their Wachtell memorandum.

Proponents of enhanced environmental, social and governance (“ESG”) disclosure have identified corporate income tax as a relevant metric. While it is premature to predict how ESG standards in this regard will evolve, a key area of focus is tax arbitrage, including profit-shifting among jurisdictions. Boards should be aware of the possibility of detailed country-by-country public disclosure intended to reveal scenarios involving high profits in jurisdictions with little economic activity and low profits in jurisdictions where a company has a significant presence.

Inspired by the Action Plan on Base Erosion and Profit Shifting of the Organisation for Economic Co-operation and Development, the standards put forth by the Global Reporting Initiative (“GRI”) in 2019 (GRI 207: Tax 2019) and the Consultation Draft of the World Economic Forum in 2020 would require (effective January 1, 2021, in the case of the GRI standards) public disclosure, by jurisdiction, of, among other things, third-party sales revenue, number of employees, profit or loss, corporate income tax paid on a cash basis and revenue from intercompany transactions. ESG initiatives also contemplate disclosure of a company’s tax policy or “approach” to tax, as well as governance and risk management processes relating to tax.

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Daily Compliance News: February 22, 2020, the $3bn Club edition

FCPA Compliance & Ethics -

FEBRUARY 22, 2020 2019 BY TOM FOX In today’s edition of Daily Compliance News: Did SFO employee leak investigation information? (Reuters) Wells Fargo joins the $3bn club. (WSJ) Grand Jury wants to know if Boeing top pilot lied to FAA. (WSJ) “I don’t think I should be held accountable” (Tone really does start at the top). (WSJ)

The post Daily Compliance News: February 22, 2020, the $3bn Club edition appeared first on Compliance Report.

Tips to Manage an Ethical Environment in a Company

The Compliance & Ethics Blog -

Posted By: Amanda Jerelyn Ethical failures in corporations have become embarrassingly familiar, and we know that they aren’t inexpensive. On the flip side, becoming an influencer of the right organization culture may lead to numerous benefits for the organization and its employees. According to a study conducted by The Society for Human Resource Management (SHRM), […]

31 Days to a More Effective Compliance Program – The Exit Interview

FCPA Compliance & Ethics -

The exit interview can be a further mechanism to operationalize compliance. This type of interview is used when someone voluntarily departs from a company, as opposed to a lay-off or reduction in force exercise. Typically departing employees are more willing to share about their experiences, concerns and issues which led to their employment departure. Three [...]

The post 31 Days to a More Effective Compliance Program – The Exit Interview appeared first on Compliance Report.

ProcessUnity Expands Vendor Risk Management Software with New Best Practices Configuration

Corporate Compliance Insights -

New out-of-the-box configuration provides quick-to-deploy, comprehensive solution for third-party risk management  CONCORD, MASS. – ProcessUnity, a leading provider of cloud-based applications for risk and compliance management, today announced a new pre-built configuration of its award-winning Vendor Risk Management solution. Best Practices Configuration for ProcessUnity Vendor Risk Management (VRM) is a pre-configured third-party risk management program with turn-key […] The post ProcessUnity Expands Vendor Risk Management Software with New Best Practices Configuration appeared first on Corporate Compliance Insights.

(This is only a summary. Click on the headline to view the entire article at Corporate Compliance Insights and participate in the discussion.)

LPQualifed Certifications Reach 1000 Mark

Loss Prevention Media -

Matt Workman, LPQ, an asset protection manager with The Home Depot, was the 1000th loss prevention professional to take and pass the LPQualified course and exam. Workman said, “The LPQ program was a fantastic learning experience. The content in the course was great and the testing experience was seamless. All that I learned in the […]

Paul Jones, LPC Named Vice President – North America Asset Protection at Ralph Lauren

Loss Prevention Media -

Paul Jones, LPC has been named vice president, North America, asset protection at Ralph Lauren. Jones is a seasoned and trusted veteran within the retail asset protection industry, having held a range of leadership experiences spanning both the retail side of the business and as an industry solution provider. For more than three decades he […]

Cops Take Down Fence In Retail Theft Ring

Loss Prevention Media -

Police are crediting an arrest last week with taking down the fence in an organized effort to steal tools from area home improvement stores and sell them online. Francisco Martorell, 38, of Southington (Connecticut), surrendered on February 13 after learning about an active warrant for his arrest, police said. The warrant charged him with organized […]

Video: Suspect Arrested in Store Robbery and Clerk Assault

Loss Prevention Media -

Detectives have arrested a Sacramento man who can be seen on security camera video stealing bottles of alcohol shortly before a Foresthill store employee was violently attacked while trying to stop the theft, the Placer County Sheriff’s Office announced Wednesday afternoon Vitaliy Blyshchyk was arrested on suspicion of robbery and criminal conspiracy in connection with […]

Luxury Brand Stores Robbed 45 Minutes Apart; 5 Held after Fleeing on Subway Tracks

Loss Prevention Media -

The incident temporarily caused “major delays” to trains, which as of 2:15 PM were running normally again, according to the CTA. Not more than 45 minutes later, police responded to another theft — an armed robbery at Louis Vuitton — where masked thieves stole several handbags from the North Michigan Avenue boutique and fled in […]

Are Crime Bosses Paying Shoplifters to Steal?

Loss Prevention Media -

There’s mounting evidence that organized retail theft rings are targeting the homeless and drug addicts to do their stealing. They know the threshold to prosecute has become so high, little or nothing will happen to them if they get caught. The thieves who walk into stores like Home Depot and take merchandise are brazen, almost […]

Corporate Purpose and Culture

The Harvard Law School Forum on Corporate Governance and Financial Regulation -

Posted by John Wilcox, Morrow Sodali, on Friday, February 21, 2020 Editor's Note: John C. Wilcox is Chairman of Morrow Sodali. This post is based on a Morrow Sodali memorandum by Mr. Wilcox. Related research from the Program on Corporate Governance includes Toward Fair and Sustainable Capitalism by Leo E. Strine, Jr. (discussed on the Forum here).

By the end of 2019 a number of extraordinary pronouncements signaled that corporate governance had reached an inflection point. In the U.K., the British Academy published Principles for Purposeful Business. In the U.S., the Business Roundtable issued its Statement on the Purpose of a Corporation. In Switzerland, the World Economic Forum published The Davos Manifesto 2020.

These statements gave voice to evolving trends and assumptions that had been transforming corporate governance over the course of the last decade.

  1. Recognition that environmental, social and corporate governance policies (ESG) represent material risks and opportunities directly impacting financial performance;
  2. Reassessment of the shareholder primacy doctrine and the narrow view of corporations as nothing more than profit machines;
  3. Adoption of “sustainability” as both a strategic goal for companies, an antidote to short-termism and a path to strengthen public trust in business and the capital markets;
  4. Acknowledgement that companies must serve the interests of their “stakeholders” as well as their shareholders;
  5. Reassertion of the principle that corporations must be accountable for the human, social and public policy implications of their activities, with an urgent focus on climate change;
  6. Understanding that a corporation’s “culture” is reflective of its integrity, its internal well-being, its sustainability and its reputation.
  7. Acceptance of expanded board accountability for ESG issues, sustainability, purpose and culture and working with the CEO to integrate these factors into business strategy;
  8. Emergence of the integrated reporting movement [www.integrated reporting.org] with its program of integrated thinking and integrated management as the basis for corporate reporting.

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Proxy Season Trends: Make Sure You’re Ready for 2020

The Harvard Law School Forum on Corporate Governance and Financial Regulation -

Posted by David Bell, Fenwick & West LLP, on Friday, February 21, 2020 Editor's Note: David A. Bell is partner at Fenwick & West LLP. This post is based on his Fenwick memorandum.

With the 2020 proxy season around the corner, we have prepared a brief review of key corporate governance trends that can inform how you frame your company’s prior-year performance and objectives for the coming year. We focus on the top five trends gleaned from 2019 proxy statements to ensure our clients and other company leaders have the tools they need to successfully navigate this important regulatory terrain.

The picture emerging from the filings as well as recent news reports indicate that the ground is shifting and near‑term shareholder value is no longer the only consideration for the C-Suite. Nearly 200 leading chief executives signed a groundbreaking Business Roundtable statement in August saying that companies “must also invest in their employees, protect the environment and deal fairly and ethically with their suppliers.” Institutions in the United Kingdom followed the Roundtable’s lead a few months later, and in December the World Economic Forum released a Davos Manifesto outlining ethical principles for corporations to follow.

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Weekly Roundup: February 14–20, 2020

The Harvard Law School Forum on Corporate Governance and Financial Regulation -

Posted by the Harvard Law School Forum on Corporate Governance & Financial Regulation, on Friday, February 21, 2020 Editor's Note: This roundup contains a collection of the posts published on the Forum during the week of February 14–20, 2020. SEC Calls “Time Out” on Proxy Advisor Guidance and ISS Litigation
Posted by Cydney Posner, Cooley LLP, on Friday, February 14, 2020 Tags:  Unprecedented Enforcement Actions Against Eight Former Wells Fargo Executives
Posted by Brad S. Karp, Jessica S. Carey, Roberto J. Gonzalez, Paul, Weiss, Rifkind, Wharton & Garrison LLP, on Friday, February 14, 2020 Tags:  Securities Class Action Filings—2019 Year in Review
Posted by Alexander “Sasha” Aganin, Cornerstone Research, on Friday, February 14, 2020 Tags:  CEO Stock Incentives Increasingly Tied to Stock Ownership and Retention
Posted by Dan Leon and LaToya Scott, Willis Towers Watson, on Saturday, February 15, 2020 Tags:  Shareholder Governance, “Wall Street” and the View from Canada
Posted by Gesta Abols and Brad Freelan, Fasken Martineau DuMoulin LLP, on Sunday, February 16, 2020 Tags:  Delaware’s Position on Director Independence: a Change in Approach?
Posted by Gail Weinstein, Steven Epstein, and Warren S. de Wied, Fried, Frank, Harris, Shriver & Jacobson LLP, on Monday, February 17, 2020 Tags:  Financial Institution Developments
Posted by Edward D. Herlihy and Richard K. Kim, Wachtell, Lipton, Rosen & Katz, on Monday, February 17, 2020 Tags:  Proposed Amendments to Financial Disclosure and Guidance on Use of Metrics in Management Discussion and Analysis
Posted by Mark S. Bergman, Paul, Weiss, Rifkind, Wharton & Garrison LLP, on Tuesday, February 18, 2020 Tags:  Stewardship and Collective Action: The Australian Experience
Posted by Tim Bowley (Monash University) and Jennifer G. Hill (Monash University), on Tuesday, February 18, 2020 Tags:  The Strategic Audit Committee: a 2020 Preview
Posted by Krista Parsons and Robert Lamm, Deloitte, on Tuesday, February 18, 2020 Tags:  Accelerated Diversity—A New Paradigm for Addressing Short-Term Obstacles to Board Membership
Posted by Bill Poutsiaka, Enterprise Driven Investing LLC, on Wednesday, February 19, 2020 Tags:  The Activist Investing Annual Review 2020
Posted by Josh Black, John Reetun, and Eleanor O’Donnell, Activist Insight Ltd., on Wednesday, February 19, 2020 Tags:  2019 Year in Review: Securities Litigation and Enforcement
Posted by Jason Halper, Kyle DeYoung, and Adam Magid, Cadwalader, Wickersham & Taft LLP, on Thursday, February 20, 2020 Tags:  Considerations for 2020 Proxy Statement Preparations
Posted by Elizabeth A. Ising and Gillian McPhee, Gibson, Dunn & Crutcher LLP, on Thursday, February 20, 2020 Tags:  The Coming Impact of ESG on M&A
Posted by Andrew R. Brownstein, David M. Silk, and Sabastian V. Niles, Wachtell, Lipton, Rosen & Katz , on Thursday, February 20, 2020 Tags: 

This Week in FCPA-Episode 193 – the Astros Blowback Continues edition

FCPA Compliance & Ethics -

As the blowback on the Astros, MLB, Commisioner Rob Manfred continues to get worse, Jay and Tom are back to consider some of the top compliance articles and stories which caught our eye this week. Airbus still making news. Asher Miller provides 5 key takeaways for the compliance practitioner in the FCPA Blog. Dylan Tokar [...]

The post This Week in FCPA-Episode 193 – the Astros Blowback Continues edition appeared first on Compliance Report.

The NY SHIELD Act is Coming: Time for a Cybersecurity Checkup?

Corporate Compliance Insights -

The New York SHIELD Act will go into effect in just a few weeks, so if your organization serves residents of New York, the time is now to make sure your company is in compliance with the law. Guidepost Solutions’ Matthew Levine provides an overview for compliance pros. In July 2019, New York Governor Andrew […] The post The NY SHIELD Act is Coming: Time for a Cybersecurity Checkup? appeared first on Corporate Compliance Insights.

(This is only a summary. Click on the headline to view the entire article at Corporate Compliance Insights and participate in the discussion.)

Daily Compliance News: February 21, 2020, the Keeping Millennials Happy edition

FCPA Compliance & Ethics -

FEBRUARY 21, 2020 2019 BY TOM FOX In today’s edition of Daily Compliance News: Kuwait launches probe into Airbus bribery. (ArabNews) Nigerian businessman to stand trial in Italy for bribery. (Reuters) Diageo settles channel stuffing claim. (WSJ) Keeping your millennial workers happy. (NYT)

The post Daily Compliance News: February 21, 2020, the Keeping Millennials Happy edition appeared first on Compliance Report.

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