The Informed Board: Recent Episodes

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What do investors think makes a board effective? Skadden M&A partner Ann Beth Stebbins kicks off the discussion with that question with her guests, Allie Rutherford and Adrienne Monley of PTJ Camberview, which advises companies on shareholder relations.

It's a board that evolves with the trends, says Allie. It's a board that discloses its composition in a way that conveys how the skill sets and the experiences of particular directors and directors in combination meet the business and strategy needs of the particular company.

Companies need to show investors that they have right directors and that those people are doing the right things as a team, following practices and engaging together in a way that supports value creation, says Adrienne. It is incumbent upon companies to be specific and help investors understand, perhaps through anecdotes, the human perspective about what's happening in the boardroom — how they run meetings and bring in outside voices, for example. Being generous with those descriptions, both in written disclosures and in engagement with investors, will help promote where investor support and understanding.

In terms of directors' skill sets, not everybody has to have every skill. It's how all of those come together, says Allie. And boards can supplement that by bringing in outside expertise.

Investors also want a board to be doing things that improve the efficacy and the functioning of the board as a team, says Adrienne. As a result, today more board self-assessments include things like independent interviews.

Because few investors have first-hand boardroom experience, it can be helpful to have direct discussions with your top investors about the board's functioning, says Adrienne.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

💡Featured Guests💡Name: Allie Rutherford

Title: Partner, PJT Camberview

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Name: Adrienne Monley

Title: Managing Director, PJT Camberview

Connect: LinkedIn

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☑️ Subscribe to The Informed Board on Apple Podcasts, Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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In this episode of the Informed Board podcast, our host, Skadden M&A partner Ann Beth Stebbins is joined by guest, Rebecca Corbin from Corbin Advisors, to explore the critical role that board directors play in shareholder engagement. Corbin stresses that a proactive approach toward shareholder engagement can enhance a company’s value.

In their conversation, Ann Beth and Rebecca discuss how a board can best stay attuned to investor sentiment, the practical actions a company can take to raise the profile of its directors, and the role of the board in spreading the culture and message of the company.

Looking at topics that investors are focused on, the episode explains that corporate culture, if communicated effectively, can give a company a competitive edge with investors. Future-readiness is another key theme, highlighting the necessity for boards to have diversified skill sets that align with the company's strategic objectives.

This episode serves as an insightful guide to the world of proactive shareholder engagement, emphasizing the role directors can play as value-enhancing ambassadors of a company.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

💡Featured Guest💡Name: Rebecca Corbin

Title: Founder & CEO at Corbin Advisors

Connect: LinkedIn

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☑️ Subscribe to The Informed Board on Apple Podcasts, Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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“There’s certainly an argument to be made, that the moment you name a new CEO, then you ought to be starting to think about who the next person is,” says Blair Jones.

In this episode of the Informed Board podcast, our host, Skadden M&A partner Ann Beth Stebbins, is joined by guests, Blair Jones, a managing director at Semler Brossy Consulting Group LLC, and Erica Schohn, partner and head of the Executive Compensation and Benefits Practice at Skadden, to explore best practices in CEO succession planning. They highlight the importance of preparedness, noting that a well-conceived succession program should serve as a contingency plan for unforeseen events, as well as for orderly retirement of a CEO.

The trio emphasize that succession planning should be an annual event, allowing for adjustments as business strategy evolves. They also discuss the necessity of having multiple candidates and keeping them incentivized, including those not selected for the CEO position. A key issue is the current CEO’s role in succession planning. Typically, the CEO will be involved, but ultimately it falls to the board to make the final decision.

The guests also highlight emerging trends in succession planning, including the use of external assessments, the role of executive chairs and the development of next-level candidates. They conclude that, while companies lean toward internal candidates during planned successions, external candidates are more likely to be considered in the case of unexpected transitions or shifts in business strategy.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

💡 Featured Guests 💡Name: Erica Schohn

Title: Partner at Skadden

Connect: LinkedIn

Name: Blair Jones

Title: Managing Director at Semler Brossy Consulting Group, LLC

Connect: LinkedIn

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☑️ Subscribe to The Informed Board on Apple Podcasts, Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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Skadden partners Ann Beth Stebbins, David Schwartz and Lara Flath discuss the implications for US companies of the Supreme Court’s decision in June striking down race-based affirmative action programs in higher education. David Schwartz is global head of Skadden’s labor and employment group, and Lara Flath is a Skadden litigation partner who represented the University of North Carolina (UNC) in the litigation relating to its consideration of race in the admissions process.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

💡 Featured Guests 💡Name: David E. Schwartz

Title: Partner at Skadden

Connect: LinkedIn

Name: Lara A. Flath

Title: Partner at Skadden

Connect: LinkedIn

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☑️ Subscribe to The Informed Board on Apple Podcasts, Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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Companies now face an additional regulatory hurdle when making acquisitions in the European Union. In addition to merger control and foreign direct investment (FDI) filings, they will be subject to the EU’s new Foreign Subsidies Regulation (FSR), Skadden partner Giorgio Motta explains. The law, which took effect in July, allows the European Commission to look into acquisitions of, and investments in, businesses in Europe by non-EU companies that have received some sort of financial support from a non-EU government.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

💡 Featured Guest💡Name: Giorgio Motta

Title: Partner at Skadden

Connect: LinkedIn

Connect with Skadden☑️ Follow us on Twitter & LinkedIn.

☑️ Subscribe to The Informed Board on Apple Podcasts,Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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In 2022, the U.S. restricted technology exports to China that might have military uses, and an executive order is expected soon limiting investments in certain Chinese tech companies. Skadden M&A partner Ann Beth Stebbins leads a discussion about the reasons for the rules and their impact on companies doing business in China. Joining her are Jessie Liu, a partner in Skadden’s White Collar Defense and Investigations Group, and partner Brian Egan of the firm’s National Security, CFIUS and International Trade Groups.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

💡 Featured Guests 💡Name: Jessie Liu

Title: Partner at Skadden

Connect: LinkedIn

Name: Brian Egan

Title: Partner at Skadden

Connect: LinkedIn

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☑️ Subscribe to The Informed Board on Apple Podcasts,Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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The SEC’s Rule 14a-8, which gives shareholders the right to put proposals to a vote of other shareholders, was adopted to allow shareholders access to other shareholders and management, BlackRock Head of External Affairs Dalia Blass explained. But it came with some protections to prevent proposals that would be a waste of time, such as those that had little to do with the company’s business. Ahead of the 2022 proxy season, the SEC changed its approach, making it harder for companies to exclude shareholder proposals, even highly prescriptive or granular, micromanaging measures.

Read the full summary of the conversation HERE.

💡 Featured Guests 💡Dalia Blas - BlackRock

Marc Gerber - Skadden

Gabrielle Wolf - Innisfree M&A

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☑️ Subscribe to The Informed Board on Apple Podcasts,Spotify, Google Podcasts, or your favorite podcast app.

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The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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In a move intended to “democratize” shareholder voting, several large index funds are giving their investors a say in how shares are voted, instead of leaving those choices to fund managers’ stewardship teams. In the pilot projects, aimed primarily at institutional investors, fund investors are given several options: to vote as the fund manager’s stewardship team recommends; to vote with management; to vote according to an advisor; or possibly some other formula to be administered by the fund manager.

The uptake of this new voting discretion is likely to be better with institutional shareholders than with retail investors, who are much less likely to vote, BlackRock’s Dalia Blass said.

Giving fund investors a say in voting underlying shares complicates shareholder communication for issuers, said Skadden partner Marc Gerber. Delegating the control of voting to fund investors makes it more difficult for companies to get their messages across to decision-makers and to receive feedback from investors. And, with pass-through voting, issuers do not know who will be making voting decisions.

Also, some investors — particularly retail investors — may ask for the right to vote their underlying shares, but not to follow through and actually vote. This can reduce the number of shares ultimately voted, shifting voting influence from mutual fund stewardship teams to active fund managers, activist shareholders and proxy advisory firms such as Institutional Shareholder Services and Glass Lewis, Gerber said.

Technically, “pass-through” is not correct, because the fund retains ownership of the shares, and its investors do not receive proxy cards; they are simply given an opportunity to direct the fund manager’s voting, Blass explained. “Directed voting” would be a more accurate term.

The potential problem of retail voters not voting is very real and significant, Blass said, because historically they have not voted in large numbers. You have to ask whose vote will be amplified by the new process – activists, for example? If retail investors claim their right to direct a vote and do not exercise it, it could make it difficult for companies to obtain the quorums they need to carry out essential corporate functions, Blass said.

Retail investors generally do not have the ability to conduct detailed analysis of complex measures, Wolf said. By contrast, fund managers have large stewardship staffs who have analytic skills and approach votes from a fiduciary’s perspective, Blass said. In addition, those teams are spread around the world and are thus capable of researching and evaluating complex corporate issues in a way that would be much more difficult for retail and smaller institutional investors, Blass said.

Index fund managers cannot vote with their feet – selling off shares when they are unhappy with a company or its management, Innisfree M&A’s Gabrielle Wolf said. Because they have to hold stocks in the index, they have to take a long-term view of value creation. Active fund managers and activists are more likely to focus on short-term value, she said. So, to the extent the pass-through voting increases their voting influence, it could lead to more emphasis on the short-term.

💡 Meet Your Host 💡Name: Ann Beth Stebbins

Title: Partner at Skadden

Connect: LinkedIn

Connect with Skadden☑️ Follow us on Twitter & LinkedIn.

☑️ Subscribe to The Informed Board on Apple Podcasts,Spotify, Google Podcasts, or your favorite podcast app.

☑️ Let us know what topics you would like to hear about on The Informed Board by reaching out to us at info info@skadden.com.

The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.

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Skadden partners Ann Beth Stebbins and Ki Hong, Joele Frank partner Jamie Moser and the chief people officer of Duck Creek Technologies, Courtney Townsend, discuss the demands companies face to take positions on political and social issues and growing scrutiny of corporate political contributions. Corporate culture is important to today’s work force, and employees often expect their employers to speak out on political and social issues that are important to them. Employees are also increasingly aware of a company’s political contributions. Understanding employee perspectives on issues that are important to them is vital, says Townsend. Management can stay in touch with the employee base through surveys, round tables or on-to-one conversations, for example. What is important to employees has become important to the business.  It is increasingly difficult for a company to avoid weighing in on political and social issues, even if  those issues do not directly affect its operations. But a company needs to have a policy to guide decisions about which issues it will address. Four factors are driving the pressure from employees, says Joele Frank partner Jamie Moser. First, a new generation of workers wants to produce and consume products and work in an environment aligned with their values. Second, social media has increased the visibility of political and social issues and made the need to respond seem more urgent. Third, political polarization has intensified the emotions around issues. Finally, the rise in importance of ESG factors across society has heightened employee interest in such matters.  When it comes to political donations, scrutiny has increased dramatically since 2015, Hong says. Companies therefore need to balance the views of stakeholders with the consequences of making contributions and taking positions on controversial issues. He notes that taking  positions on social and political issues, if not carefully thought through, could cause the company to lose business.  Moser and Hong emphasize that businesses need to anticipate the types of issues on which they may be asked to take a position and decide which issues warrant a public position and which do not. Advance planning is essential. You do not want to be formulating your strategy in the middle of a media storm, they stress. Sometimes responding to a political issue requires a company to first research logistical questions, Moser points out. That was true when the U.S. Supreme Court delivered its decision in the Dobbs case regarding abortion rights. Companies had to sort out insurance and various legal questions before responding to employees’ concerns about the decision’s impact on them. In such circumstances, to maintain credibility, leadership should communicate that the company is addressing the issue and, if possible, how the company is approaching the matter even if it cannot immediately provide answers, Moser advises. Companies can face very different business consequences for their positions on political and social issues depending on the jurisdiction, Hong notes. For example, Texas passed a law barring the state from doing business with companies that take positions in opposition to fossil fuels, and Cook County, Illinois may require its vendors to offer abortion coverage to their employees.  On any given issue, satisfying all stakeholders may not be possible, Hong warns.  Related to these issues, directors who come up for election soon could find more attention being paid to them as individuals — not just as members of a slate — because of the introduction this proxy season of the “universal proxy card” , making it easier for shareholders to choose individual directors, Moser explains. That could lead activists and others to conduct research on the statements and political contributions of directors, in an effort to challenge their board candidacy. ...

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In this inaugural episode of “The Informed Board” podcast, Skadden partners Maria Raptis and Raquel Fox join our host Ann Beth Stebbins to discuss changing approaches to antitrust and securities regulation in Washington. They talk about new priorities in antitrust enforcement, new disclosure initiatives by the Securities and Exchange Commission (SEC), and the obstacles that could hinder regulatory rulemaking.  Since President Biden took office, there has been a shift in Washington. The administration’s policies were no surprise; the president campaigned on them. But the ways in which regulatory agencies have been harnessed to pursue the administration’s objectives is new: broadly exercising their review authority and proposing a host of new regulations with expansive goals unrelated to their traditional mandates. In part, this reflects the difficulty of passing legislation in areas that are priorities for the administration.  In antitrust, the focus has broadened under the Biden administration. Top officials believe that antitrust enforcement has been too lax, leading to too much consolidation and too much concentration of economic power. Antitrust officials contend that the consumer welfare criteria that have dominated antitrust analysis for the past 50 years are too narrow, and that antitrust laws give antitrust agencies a broader mandate to consider the impact of mergers on workers and small business. However, Maria says we’re unlikely to see a sea change in antitrust law anytime soon unless legislation is passed to change the legal standards and make it easier for the FTC and the Department of Justice to challenge mergers. Despite antitrust regulators’ ambitious goals, there are many obstacles to swift, sizeable change, including many decades of court precedent that focus on consumer welfare tests. On the SEC side, for the first time in many years, the agency’s rulemaking resources are not devoted to congressionally mandated regulations, so the commission can take up broader issues prioritized by the White House, including climate change and human capital. The SEC recently proposed new rules requiring detailed climate disclosure, and we expect proposed rules requiring additional workforce-related disclosures before the end of the year.  But, like the new antitrust policies, the SEC’s initiatives may be challenged in court. Critics say the climate disclosures would require costly outside audits and attestations, as well as complex greenhouse gas measurements, Raquel explains. The proposed rules might be challenged either on the ground that the costs outweigh the benefits or that, with no explicit legislative mandate, the proposed disclosure requirements are beyond the SEC’s remit. 💡 Meet Your Host 💡Name: https://www.skadden.com/professionals/s/stebbins-ann-beth (Ann Beth Stebbins) Title: Partner at Skadden Connect: https://www.linkedin.com/in/ann-beth-stebbins/ (LinkedIn) 💡 Featured Guests 💡Name: https://www.skadden.com/professionals/r/raptis-maria (Maria Raptis) Organization: https://www.skadden.com/ (Skadden) Connect: https://www.linkedin.com/in/mariaraptis/ (LinkedIn) Name: https://www.skadden.com/professionals/f/fox-raquel (Raquel Fox) Organization: https://www.skadden.com/ (Skadden) Connect: https://www.linkedin.com/in/raquel-fox/ (LinkedIn) https://www.skadden.com/insights/publications/the-informed-board (See current and past Informed Board articles here).

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From Skadden, The Informed Board is a podcast for directors facing the rapidly evolving challenges of a global market. A complement to our newsletter for directors, our aim with this podcast is to help flag potential problems that may not be fully appreciated, explain trends, share our observations and give directors practical guidance without a lot of legal jargon. Join Skadden partners who draw on years of front-line experience inside boardrooms to explore the complex issues facing directors today. If you like what you’re hearing, be sure to subscribe to your favorite podcast app so you don’t miss any future conversations. Additional information about Skadden can be found at Skadden.com. The Informed Board is a podcast by Skadden, Arps, Slate, Meagher & Flom LLP, and Affiliates. This podcast is provided for educational and informational purposes only and is not intended and should not be construed as legal advice. This podcast is considered advertising under applicable state laws.