The Activist Investor Blog
The Activist Investor Blog
The Seven Biggest Corporate Flunkies
Who are the most prominent executive tools? CEO valets? Leading puppets, toadies, and stooges? (Didn’t know that English has so many interesting words to describe these folks.)
Investors hear from all manner of attorneys, analysts, and others that promote, shamelessly, well-entrenched and well-paid corporate interests. These corporate hacks (another good word!) defend vigorously, and blithely, excessive CEO and director compensation, unfettered BoD independence, rigged corporate elections, and sole executive prerogative over investor assets.
For years we’ve grown weary of those many embarrassing CEO apologists. We occasionally attempt to draw attention to the most offensive examples. Here, after enough aggravation, we call out the most prominent offenders.
7. Chuck Nathan
A corporate securities attorney whom we critiqued before. Until about a year ago, he toiled at corporate law behemoth Latham & Watkins, where he wrote numerous clever newsletters that have a pretense of objectivity, but mostly criticize investor efforts to protect their interests. He lands at the bottom of this list only after moving from corporate law to public relations, joining RLM Finsbury. Since most PR firms have both corporate and investor clients (with a notable exception mentioned below), he now writes newsletters defending activist investors.
6. John Carney
Reporter and blogger for CNBC. He presumably has a journalist’s sensibility for objective reporting, but seems to take the side of corporations at most every turn. While a
recent article has been a bit more even, his other efforts over the years criticize activist investing generally, and activist investors specifically.
5. Stephen Bainbridge
Law professor at UCLA. Just read his blog, where he cloaks a brazen pro-corporate philosophy in academic legalese. In particular, he relentlessly promotes (and self-promotes) the controversial “director primacy” view of corporate governance. Earlier he spent much time bashing labor union activist efforts, and more recently turned to bashing hedge funds and other institutions, that dare question the motives and actions of imperial directors and executives.
4. James Copeland
Executive at the Manhattan Institute, a staunchly pro-business think tank. There, he runs Proxy Monitor, a website and database of shareholder proposals at the “250 largest American public companies” filed since 2006. This useful website ostensibly serves as an objective resource of shareholder proposals at annual meetings. Their motto, “Shedding light on the influence of shareholder proposals on corporations,” and the analysis and papers they publish at the website, betray their core purpose, to rally support for executive interests.
3. Joele Frank
PR consultant supreme, at her eponymous firm that works exclusively for corporations. To her credit she candidly admits that she works that way. A PR pro, the firm says relatively little about itself, and instead wants publicity for its clients. By reputation she defends rabidly even the worst corporate governance practices. The little public information available seems to affirm this. In an interview last year she reveals her philosophy; at their website they introduce the interview tellingly: “Our firm has helped numerous companies defend themselves against aggressive actions by activist investors.”
2. J.W. Verret
Law professor at George Mason University. (Interestingly, he got his start at Harvard Law, where he apprenticed to Prof. Lucian Bebchuk, a critic of corporate interests.) He has written a number of papers - “Defending Against Shareholder Proxy Access” and “The Misdirection of Current Corporate Governance Proposals”, among others - that provide a detailed checklist for subverting investor efforts to influence portfolio companies.
1. Marty Lipton
Who else but? The archetypical board room attorney, and founder of one of the most successful corporate law firms. He basically invented the poison pill, and helped it grow from a defense against coercive takeover proposals to an effective way to fight investors of any type. He writes frequent polemics accusing investors of every offense short of murder and treason. More recently, he has argued fiercely with Prof. Bebchuk over the impact of activist investing on company performance.
So, who are your favorite corporate cheerleaders?
Tuesday, September 3, 2013