Stay current on changes and developments in corporate law with a wide variety of resources and tools.
By Che Odom
March 29 — Corporate secretaries increasingly spend a large portion of their time interacting with institutional investors over governance issues, even as their budgets remain relatively flat.
A survey this year of corporate secretaries from 276 companies, obtained by Bloomberg BNA from the Society of Corporate Secretaries & Governance Professionals March 29, found that 63 percent of respondents are at least somewhat involved in investor communications.
The survey also found that half of corporate secretaries at large-cap companies directly initiate contact with investors, while 30 percent of those at mid- and small-cap companies do so.
“Year over year, the demands of investor communications increase, yet corporate secretaries are not getting more resources,” Darla Stuckey, the society's president and chief executive officer, told Bloomberg BNA March 29. “That is one frustration with the growth in engagement with institutional investors, but a focus on governance best practices is positive.”
The corporate secretary position typically is held by a relatively senior member of management, often the general counsel. While the role includes responsibility for record-keeping tasks, the position also involves serving as liaison among corporate stakeholders, such as directors, officers and stockholders.
“Communicating investor views to their company’s board and management was particularly important this year as companies considered proxy access and other proposals,” Stuckey said.
Since 2014, more than 200 public companies have adopted provisions that allow eligible shareholders to nominate directors to their boards, which could create more investor-related work for secretaries, Stuckey said.
Forty percent of survey respondents said the number of investor questions about proxy access and other governance issues has increased over the last few years.
The surge in shareholder activity on governance issues can be attributed largely to the enactment of the 2002 Sarbanes-Oxley Act, the 2010 Dodd-Frank Act and Dodd-Frank's say-on-pay provisions that require companies to hold shareholder votes at least once every three years on executive compensation packages .
The focus on governance best practices is a positive change, but the increase in interaction can be taxing on corporations and investors, Stuckey said .
“You have investors who are turning away companies seeking engagement on issues,” she said. “Both sides want to establish relationships, but that can take a lot of time.”
To contact the reporter on this story: Che Odom in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Yin Wilczek at email@example.com
The survey will be released this week by Rivel's Corporate Governance Intelligence Council, at www.rivel.com.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)