On September 23, 2010, NYSE Euronext's Commission on Corporate Governance released a report identifying 10 fundamental governance principles for investors, issuers, broker-dealers, and other market participants.
The NYSE-sponsored Commission's 10 core principles of strong corporate governance are the following:
- The Board must focus on creating long-term sustainable growth instead of encouraging excessive risk-taking;
- Corporate management has a critical role in corporate governance;
- Although NYSE does not limit a board to just one non-independent director, it encourages boards to establish an appropriate representation of independent directors;
- Market-based and collaborative governance solutions are preferable to over-reliance on legislation and agency rule-making;
- Good corporate governance should be integrated with the company's business strategy and not viewed as simply a compliance obligation;
- Shareholders have a responsibility and long-term economic interest to vote their shares in a reasoned and responsible manner, and should engage in a thoughtful dialogue with companies;
- Transparency is critical to good governance--while companies should have appropriate disclosure policies and practices, investors should disclose ownership of derivatives or other securities on a timely basis;
- Proxy advisory firms serve an important role in the markets, and thus should be held to appropriate standards of transparency and accountability;
- The SEC should work with exchanges to ease the burden of proxy voting while encouraging greater participation by individual investors in the proxy voting process; and
- The SEC should not only periodically assess the impact of major governance reforms, but should also expand the use of "pilot" programs to help identify any implementation problems before a program is fully rolled out.
NYSE Commission on Corporate Governance's News Report can be found here; its video news release, here; and its full report here.
To view the members of the Commission, click here.
Posted by David Schatz