CALPERS LISTS GUIDELINES FOR BOARDS.Byline: Adam Bryant The New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of Times The California Public Employees' Retirement System released a blueprint blueprint, white-on-blue photographic print, commonly of a working drawing used during building or manufacturing. The plan is first drawn to scale on a special paper or tracing cloth through which light can penetrate. Monday describing what it thinks are basic requirements for the structure of corporate boards. Calpers, the nation's largest public pension fund, suggested, among other things, that independent directors make up a majority of a board, that boards appoint a director to balance the power of a chief executive who is also chairman, and that directors receive only cash or stock as compensation, but no extra benefits like retirement plans. It also suggested more stringent guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. that it called ``ideals.'' For example, retiring chief executives would not be allowed to serve as directors; the chief executive would be the only company employee who is a director; and the chairman would be an independent director. Calpers released the criteria Monday morning, its own board stopped short of approving the list, apparently because of disagreement over two suggestions - that directors no longer be considered independent after 10 years on a board, and that no more than 10 percent of a board's directors be older than 70. Calpers' principles of corporate governance Corporate Governance The relationship between all the stakeholders in a company. This includes the shareholders, directors, and management of a company, as defined by the corporate charter, bylaws, formal policy, and rule of law. , although still in draft form, are certain to get the attention of corporate America. With $113 billion in assets, Calpers is the nation's largest and most prominent player in the shareholder-rights movement, and it knows how to apply public pressure. Each fall, for example, Calpers selects from the 1,500 companies in its portfolio 10 whose long-term stock market performance places them at the bottom when compared to their industry peers. It then publicizes the list, and asks for meetings with company managers and agitates for change. The fund, based in Sacramento, plans a similar strategy with its principles for corporate governance, which, it said, represent an effort to be more prescriptive pre·scrip·tive adj. 1. Sanctioned or authorized by long-standing custom or usage. 2. Making or giving injunctions, directions, laws, or rules. 3. Law Acquired by or based on uninterrupted possession. , rather than reactive reactive /re·ac·tive/ (re-ak´tiv) characterized by reaction; readily responsive to a stimulus. re·ac·tive adj. 1. Tending to be responsive or to react to a stimulus. 2. . Calpers intends to vote against re-election of directors at underperforming companies if the boards do not meet the criteria. ``With these principles, Calpers can embark on Verb 1. embark on - get off the ground; "Who started this company?"; "We embarked on an exciting enterprise"; "I start my day with a good breakfast"; "We began the new semester"; "The afternoon session begins at 4 PM"; "The blood shed started when the partisans its next evolutionary step - to focus not only on today's underperformers but also on tomorrow's,'' Calpers said. |
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