How’s the CEO ‘Stakeholder Pledge’ Working Out? Depends Who You Ask – WSJ

VEA Vice Chair Nell Minow is quoted in this WSJ column by John Stoll about the BRT’s stakeholder rhetoric. Nell Minow, vice chair of ValueEdge Advisors, which consults with institutional investors on corporate governance, agrees with Mr. Bebchuk about tradeoffs, but she cautions “those tradeoffs are rarely permanent.” She said directors need to push executives…

The BRT’s Fake Stakeholder Promise: One Year In

A year from the Business Roundtable’s announcement that they were broadening their focus on stakeholders, what are the results? Unsurprisingly, the BRT gives itself an A. Executive Director Joshua Bolten writes in the Wall Street Journal: The CEOs who signed the new statement believe it better reflects their conviction that businesses can’t flourish over the…

‘Stakeholder’ Capitalism Seems Mostly for Show – WSJ

We said as soon as they accounted it that we did not believe the Business Roundtable’s new claims of commitment to stakeholders. Now Lucian Bebchuk and Roberto Tallarita confirm that we were right to be skeptical. By putting American workers through months of turmoil, the Covid-19 crisis has heightened expectations that large companies will serve…

In Stakeholder Capitalism, Shareholders Are Still King – WSJ

[B]ig business in the U.S. is talking up stakeholder capitalism as it fends off growing criticism of its place in society. Most prominently, in August, the Business Roundtable released a statement signed by 181 CEOs in which they pledged “a fundamental commitment” to “deliver value to all” stakeholders. For some people, this renewed interest in…

Prudential’s multi-stakeholder framework reinforces board commitment to investors, employees, customers and society

The Board of Directors for Prudential Financial, Inc. (NYSE: PRU) has introduced a multi-stakeholder framework that extends the board’s accountability to shareholders, employees, customers and society. “As board members, we believe our duty includes enabling positive change for a much broader set of individuals, groups and interests, in addition to creating strong value for shareholders,”…

Performance Metrics: Accelerating the Stakeholder Model

When the Business Roundtable announced their “new” commitment to “stakeholders,” we said it was not meaningful unless we saw incentive compensation aligned to specific stakeholder goals. At the Harvard Law School Forum on Corporate Governance and Financial Regulation, Equilar research analyst Connor Doyle looks at current incentive plans tied to goals other than the traditional…