Legal 500 Governance

The Corporate Governance Dialogue in 2021 continued to focus on environmental, social and governance (“ESG”) issues. Some of these issues directly related to corporate governance (e.g., board renewal and diversity) have long been discussed within the governance community. A wider range of ESG issues, including issues such as environmental sustainability, supply chain management and employment practices, are now at the forefront. Jones Day has a strong reputation for corporate governance and helps many leading clients solve their most complex and important problems. The team`s extensive expertise includes ESG factors, proxy battles, acquisition preparation, board composition and fiduciary duties. The firm is led by Lizanne Thomas, who divides her time between the New York and Atlanta offices. Thomas regularly sits on special committees on control and conflict transactions as well as internal investigations. Justin Macke, newly promoted, partner based in New York, has extensive experience advising publicly traded companies on public mergers with activist shareholders. Another name is Joanna Sutton, an Atlanta-based employee who works for clients in a variety of industries, including food, energy, textiles, chemicals and technology. “The team consistently provides business and practical advice tailored to our situation, based on their unparalleled legal and regulatory knowledge.

In addition, many U.S. companies have introduced the right to allow shareholders to call a special meeting between annual meetings or to act with written consent. Specific restrictions surrounding these rights, often including shareholding thresholds, are set out in the Corporation`s corporate documents. Companies have a wide margin of discretion in establishing these restrictions, which can range from restrictive to highly permissive. The dominant trend in U.S. public corporate governance has shifted toward more permissive rights for shareholders to call special meetings and act with written consent. “Katharine Harle, who has been my main contact person for corporate governance issues over the past few years, has given me excellent and timely advice. The CA is the main source of Singaporean law, which governs how companies are to be governed, as well as its subsidiary legislation as well as common law.

The Securities and Futures Act and its subsidiary legislation govern, inter alia, the activities of the securities industry, such as market conduct and insider trading. Companies listed on the SGX must also comply with the SGX-LR. The GC Code (and accompanying practice guidelines) sets out best practices in corporate governance; its principles are binding and its provisions apply on a “comply and explain” basis to companies listed on SGX. “They are extremely practical and strategic in their advice – not only in legal advice, but also in developing the strategy to maximize the client`s chances of winning a proxy contest. A few years ago, many companies in the U.S. began to focus more on ESG issues, driven by the growing interest of large institutional investors in these issues. Many companies have begun publishing “annual sustainability reports” highlighting their commitment to sustainability, diversity and good governance, and have incorporated information on these topics into their public and investor documents. U.S. public companies are also influenced by institutional investors – particularly the largest index funds – who have significant influence and voting power and are increasingly seeking to impose their views on various corporate governance issues. “Marc Weingarten brings more knowledge and expertise to this practice than most people expect. He is one of the sponsors of the investor rights activist company and his reputation as a lawyer is well deserved. Hogan Lovells US LLP`s securities and public company advisory practice is “very knowledgeable about the latest trends in corporate governance.” The team consists of a variety of former senior employees of the U.S.

Securities and Exchange Commission (SEC), and one name to consider in the SEC compliance space is Alan Dye. One of the group`s constant objectives is to advise companies recovering from the effects of Covid-19; Alex Bahn and others have helped Choice Hotels International resolve many of the disclosure and governance issues related to the pandemic. The firm is led by John Beckman, who “quickly helps prepare pragmatic solutions for each industry and client.” In New York, Lillian Tsu left the firm in September 2021 to join Cleary Gottlieb Steen & Hamilton. Unless otherwise stated, all of these attorneys are based in Washington DC. In addition, the largest institutional asset managers have invested heavily in recent years in building their own corporate governance teams so that they can make their own voting decisions about the companies in which they invest. Cleary Gottlieb Steen & Hamilton`s multidisciplinary corporate governance team provides a full range of services to U.S. and international clients. The work covers a variety of areas, including regulatory compliance (including SEC and stock exchange requirements), ESG factors, compensation and benefits structuring, and relationships with sponsors and other shareholders. In addition, internal and external investigations are another driver of the practice, which is co-led by New York trio Francesca Odell, attorneys Helena Grannis and Jim Langston. Lillian Tsu joined Hogan Lovells US LLP in September 2021. Investors can make claims against the company.

In a GA and an SE, however, they cannot enforce a breach of obligations of the members of the board of directors (with a few exceptions in special legal provisions – e.g. in the event of insolvency and in the context of intention). On the contrary, the members of the governing bodies are jointly and severally liable to the company on the basis of their joint liability. Thus, individual members of a management and supervisory body cannot be exempted from liability on the ground that a particular task or responsibility has been delegated internally to another member. In addition, such a breach may result in dismissal and, in respect of the members of the board of directors, the termination of their employment contract. In principle, the supervisory board is competent and – according to case law – even obliged to assert claims for damages against the members of the management board. The Company may only waive its claims for damages or enter into settlement agreements on these claims if three years have elapsed since the claim arose and the Annual General Meeting has decided to do so without the objection of a minority of shareholders (at least 10% of the share capital). In the event of culpable breach of duty by the members of the Supervisory Board, the Management Board is obliged to jointly and severally pursue any action for damages against the members of the Supervisory Board.

The rights and obligations relating to the assertion of rights against members of corporate governance bodies of a GA, an SE and a KGaA are independent of whether or not the members of these bodies are released. Another particular consequence of a breach of an obligation in a listed company is that the company may be obliged to disclose it to the capital market by means of an ad hoc announcement. In the case of a GmbH, the consequences of a breach of the obligations of the managers are broadly comparable to those of a general service. As a general rule, the managers and the members of the management board are not directly liable to the company`s creditors. However, the general meeting is empowered to assert claims for damages and to decide on the dismissal of the managers and the termination of the employment contract. If the general meeting has exonerated the managing director in full knowledge of the facts giving rise to a violation, the discharge entails an exclusion of liability unlike in the AG case (see paragraph 12 above). Hogan Lovells US LLP has extensive experience in activist campaigns and complex corporate governance issues. His strength in advising publicly traded companies reflects the extensive expertise of Practice Director Paul Hilton, who divides his time between Denver and New York. In October 2020, Matt Thomson left the Washington DC-based team to pursue an internal career. Boards of directors of companies listed on the New York Stock Exchange are required to conduct annual reviews of the performance of the board itself and board committees, and the Nominating and Corporate Governance Committee is responsible for “overseeing the evaluation of the board and management.” Although Nasdaq does not require it, annual board evaluation is now a near-universal practice, with 98% of companies conducting some form of annual board evaluation.

The main sources of substantive corporate governance rules are the laws of the state in which the company was incorporated, listing requirements, and, to a lesser extent, regulation by the SEC.