The EC’s “Green Paper” on CG and Remuneration in Financial Institutions

The European Commission's Green Paper on corporate governance and remuneration policies in financial institutions madenumber of significant suggestions, including:

a) limiting the number of board memberships, and requiring greater expertise and qualificationson boards;

b) mandating risk committees and stronger risk management functions;

c) fortifying the legal liability of directors under an expanded duty of care;

d)regulating or restricting stock options; and

SEC Web Page Sets Forth Timeline for Reforms

The SEC has set forth a time linefor finalized rules as well as tentative timing for future proposals and rulings, with respect to all the changes and studies required by the Dodd-Frank Wall Street Reform and Consumer Protection Act that as signed into law on July 21, 2010.

http://www.sec.gov/spotlight/dodd-frank.shtml

The Dodd-Frank Act itself can be found here:

http://www.sec.gov/about/laws/wallstreetreform-cpa.pdf

Why are Outside Directors Appointed? Do they Improve Corporate Performance?

Professor Saito of Kyoto Sangyo University has producedextensiveanalysis and several papersshowing thatJapanese companies that appoint at least one outside director experience improvement in operating performance and more dependable projections.

Boards with and without Outside Directors: An Empirical Comparison

The Determinants of Board Composition when Managers Control Director Selection: Evidence from Japan

NYSE’s Commission on CG: Put Enough Managers on the Board

The report of the NYSE Commission, issued this fall, summarized this particularreccommendation in the following way in its press release:

While independence is an important attribute for board members, the NYSE’s Listing Standards do not limit a board to just one non-independent director, and boards should seek an appropriate balance between independent and non-independent directors to ensure a proper mix of expertise, diversity and knowledge.