regulations and strategies for corporate governance

8/2/2019 Regulations and Strategies for Corporate Governance

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Regulations and Strategies for

Corporate Governance


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Sarbanes-Oxley Act

Passed in 2002 .

Specifically toward the structures of U.S.corporations.

Protecting investors and establishingguidelines for financial reporting.

Regulations are legally binding for publicly

listed businesses that are domestic to theUnited States and foreign companies tradedon U.S. stock exchanges.

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Applying the Key Principles of

SOX to All Organizations

a document of accounting best principles.

three integral principles: integrity, reliability, and

accountability.

Integrity: completeness of the financial records.

Reliability: accurate information.

Accountability: someone must be held

accountable for the establishment of controls and

the consequences should those controls fail.

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Regulations for Shareholder Proposals

The 1934 Securities Exchange Act governs the

process by which shareholders are able to

submit proposals.

shareholders are eligible to submit proposals

if they have held 1% of the companys voting

stock for a term of one year or more.

The guidelines also limit shareholders to one

proposal per meeting.

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Meeting Proposal Requirements

The shareholder submitting the proposal must

own 1% ofthe companys shares at the time of

submission and have owned that stock for at

least one year.

The submitting shareholder must continue to

own at least 1% of the companys shares through

the date on which the proposal is voted on. Each shareholder may submit only one proposal

per shareholder meeting.

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Meeting Proposal Requirements

Proposals must adhere to a 500-word limit.

Proposals must be submitted prior to the

submission deadline.

Shareholder proposals must relate to activities

that account for more than 5% of the

corporations total revenue and assets.

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Organization for Economic

Cooperation and Development

(OECD) offers membership for 30 countries

and has a relationship with over 70 others.

Involved with other economic areas, including

nongovernmental organizations.

facilitates policy discussion, generates

statistics, and publishes guidelines, such as its

Principles of Corporate Governance.

global guide for Corporate Governance efforts.

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Principles

1. Framework- establishing a foundational

framework for Corporate Governance.

2. Shareholder rights

3. Stakeholder considerations- fair treatment.

4. Transparency

5. Responsibilities of the board

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Member Countries

of the OECD

Australia June 7, 1971

Austria September 29, 1961

Belgium September 13, 1961

Canada April 10, 1961

Czech Republic December 21, 1995

Denmark May 30, 1961

Finland January 28, 1969

France August 7, 1961

Germany September 27, 1961

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Member Countries

of the OECD

Hungary May 7, 1996

Iceland June 5, 1961

Ireland August 17, 1961

Italy March 29, 1962

Japan April 28, 1964

Korea December 12, 1996

Luxembourg December 7, 1961

Mexico May 18, 1994

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Member Countries

of the OECD Netherlands November 13, 1961

New Zealand May 29, 1973

Norway July 4, 1961

Poland November 22, 1996

Portugal August 4, 1961 Slovak Republic December 14, 2000

Spain August 3, 1961

Sweden September 28, 1961

Switzerland September 28, 1961

Turkey August 2, 1961

United Kingdom May 2, 1961

United States April 12, 1961

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