October 10, 2003

NYSE Sends Its Presumed Final

On Wednesday, the NYSE filed a second amendment to its proposed corporate governance listing standards with the SEC. The NYSE had made its original filing last August and filed the first amendment back in April. The current amendment (which reflects the Exchange’s response to 64 comment letters from the public as well as from the SEC) is expected to be the NYSE’s final filing with the SEC – as the NYSE sent an email to issuers indicating that the SEC might approve these standards as early as next week.

Markets Appear to Appreciate Director Independence

The executive search firm Christian & Timbers recently released results of a study it did on 15 large public companies that had each elected new, independent directors to their boards. That study found that the value of the company’s stocks rose at an annualized rate of 91.5% during the period beginning with the election of the new directors.

Analysis of Shareholder Access Proposal

As the community knows, the SEC’s new proxy access rules will hinge on a couple of triggering events — one of which will be the receipt of 35% or more “withhold” votes for any given director or directors. (For a good recap of the rules based on the little we’ve gotten from the press release and the open meeting, see Mike O’Sullivan’s blog summarizing the proposal. We’re still hoping to see the SEC’s release later today.)

Floyd Norris reported in the New York Times yesterday that Calpers will be withholding its votes from members of any audit committee who vote to allow the company’s independent auditor to perform any tax advisory services. This is really not anything new as CalPERS had announced this policy during the past proxy season – and actually might withhold votes if an independent auditor provides any type of non-audit services this season.