 Corporate Governance Contacts |
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| SBA Related
Publications |
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| What We Do |
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We frequently attempt to influence and affect
improvements in the corporate
governance
structures of individual companies. We achieve these objectives through
a number of different, but integrated
strategies.
Develop and implement proxy
voting guidelines that improve the corporate
governance
structures of the companies we own. The proxy vote is a
fundamental right tied to owning stock and
creates a fiduciary responsibility upon
pension plan managers to ensure proxies are voted in the best interest of
fund
participants and beneficiaries. A
proxy vote, as part of a bundle of shareholder
rights, has a value in the market. As the instrument
by which a company's Board
of Directors is elected, a share's voting rights can
transfer control of the corporation
from one party to another
(generally known as the “control share premium”).
Empirical studies have shown
that approximately 4% to 5% of a share’s value may
reflect this premium. Through the
development and implementation of
comprehensive corporate governance principles and proxy voting guidelines, the
SBA
assures that proxies are voted consistently. The SBA’s corporate
governance
principles and proxy voting guidelines address a wide range of issues, including
auditor independence, board structure, director independence, as well as the types
and levels of executive compensation.
Publish an annual report of the SBA's corporate
governance activities.
After the end of the proxy
season, a comprehensive report is produced analyzing all
of the SBA’s
proxy votes on corporate governance resolutions including highlighted
votes and significant capital markets events.
Provide full transparency of
the SBA proxy voting guidelines and individual
votes on our web
site. We disclose information about specific proxy votes
immediately after the annual or special shareholder meetings occur. We regularly
express our views and positions by voting tens
of thousands of individual ballot
items each year.
Publicly support (or oppose)
specific issues and provide regulatory and/or
legislative commentary. When appropriate and in line with the SBA’s corporate
governance principles, we may issue press releases, respond to media inquiries
and/or support or oppose shareholder initiatives coordinated with other institutional
investors. Since many new rules and regulatory proposals are released for
public review, the SBA periodically submits formal comment to key regulatory
oversight bodies such as the Securities and Exchange Commission (SEC), the
stock exchanges (e.g., the New York Stock Exchange and Nasdaq Stock Market),
the Financial Accounting Standards Board (FASB), and the Public Company
Accounting Oversight Board (PCAOB).
Engage
individual company portfolio holdings on various corporate
governance issues. Frequently, the SBA discusses proxy voting issues and
general corporate governance topics directly with owned companies. For example,
at times we may write letters to members of a board of directors to communicate
our general or specific corporate governance concerns. Less frequently, we may
seek opportunities to meet with individual directors or committees of the board to
express similar views or submit shareholder proposals for approval on a company's
proxy statement.
Coordinate
active strategies with other large shareholders and shareholder
groups. The SBA routinely interacts with other shareholders and groups of
institutional investors on management quality and performance, executive
compensation, board member independence and other significant governance
topics. By being receptive to other investors, we stay abreast
of issues involving
specific companies and general corporate
governance issues, including legal
and regulatory changes.
- Council of Institutional Investors
(CII) - We remain an active member in
the CII, which serves as the leading proponent of shareholder issues
affecting public pensions in the United States and has membership
controlling over $3 trillion in assets.
- International Corporate Governance
Network (ICGN) -- Our membership in ICGN provides access to leading institutional investors concerned with corporate governance policy issues within the global capital markets. ICGN has membership controlling over $15 trillion in assets.
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Pursue corporate governance reforms through securities
litigation.
The SBA may
pursue corporate governance reforms within the scope of legal
settlements of securities class action suits. The ability
of institutional investors to
get involved in securities class action
litigation was enhanced by the Private
Securities Litigation
Reform Act (PSLRA), passed by Congress in 1995. The
PSLRA
made a number of significant changes to the securities
class action
litigation process,
including requiring the lead plaintiff to be the person or group
that either filed
the complaint or has the largest financial interest in the case.
In
some cases, the SBA has served as lead plaintiff. The SBA has
also “opted-out”
of
class action settlements and filed individual suits. |