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April/May 2007

 

In this Issue:

Cover Story

Unstacking the Executive Compensation Deck

One dramatic consequence of the recent scandals over executive compensation is the emerging shift in control over the executive pay agenda from management to the board’s compensation committee. These scandals can almost invariably be traced to a fundamental mystery in the executive compensation realm— the fact that management has traditionally controlled virtually all aspects of the process by which its own pay is determined. Full Story

In Search of Ethical Sourcing

Supply-chain standards can bolster corporate reputations and support shareholder value Full Story

The No-Paper Trail

LexisNexis says digitizing documents can save money and provide a legal edge Full Story

More Progress Vs. the Plaintiffs' Bar

For the second half of 2006, the chamber spent a record $49.2 million on lobbying, with $17.7 million of that amount handed out by the chamber’s Institute for Legal Reform, according to the campaign fund database Political Money Line. A good part of the funds were spent on pushing the chamber’s ideas of tort reform, designed to limit shareholder lawsuits. Full Story

No Break on FIN 48

he Financial Accounting Standards Board shocked the green-eyeshade crowd in mid-January by refusing to postpone the effective date of its Interpretation No. 48, “Accounting for Uncertainty in Income Taxes.” Full Story

Evaluating a Buyout

It's the board's job to judge whether an LBO will benefit shareholders, says private equity leader Justin Wender Full Story

The Battle for the Soul of Capitalism

Directors are at the heart of a complex battle over who's in charge of corporate decision-making. Will that stifle American risk-taking and innovation? Full Story

Big Labor Makes Its Wishes Known

Unions such as AFSCME have replaced public pension funds as the most frequent authors of shareholder proposals. Full Story

Backdate-Proof Options Pricing?

After years of haggling, the Securities and Exchange Commission has approved a new, derivative-based method of setting market values for stock options. The new method was devised by Zions Bancorporation and uses an online, modified Dutch auction to set market-based prices for options. Full Story

Asking the Right Tech Questions

IT belongs on the board's agenda, especially when it enables strategy. So directors must insist on clarity from management. Full Story

Finding the Next Growth Driver

Harvard's Clayton Christensen says boards do have a role to play in innovation. Full Story

When Oversight Spans the Globe

The board of a multinational company is responsible for a longer and more complex value chain. Full Story

Drumbeats on CEO pay

True to predictions, the new Democratic-controlled Congress is moving toward reining in executive compensation. The House Financial Services Committee, headed by U.S. Rep. Barney Frank is looking to revise a failed 2005 bill that would have required shareholders to approve pay packages for top executives. Full Story

Fired With Enthusiasm

Boards should know that CEO setbacks can prove to be positive. Full Story

Barney Frank's Grand Bargain

The outspoken champion of the working class wants to compromise with Corporate America. A close look at Frank suggests he will take a measured approach to leading Financial Services. Acquaintances say that, ultimately, his steel trap of a mind always reins in his emotions. Full Story