Corporate vigilance equally prudent for private investors. (Wall Street West).SHAREHOLDERS of companies large and small aren't the only ones griping about 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. and starting to flex their muscles. As Louis "Skip" Miller of Christensen Miller Fink fink Slang n. 1. A contemptible person. 2. An informer. 3. A hired strikebreaker. intr.v. finked, fink·ing, finks 1. To inform against another person. Jacobs Glaser Well & Shapiro can attest, the accountability of management to shareholders is the same: there are fiduciary responsibilities that cannot be breached. Miller represents a group of disgruntled dis·grun·tle tr.v. dis·grun·tled, dis·grun·tling, dis·grun·tles To make discontented. [dis- + gruntle, to grumble (from Middle English gruntelen; see shareholders (mostly venture capitalists) in privately held Pasadena business incubator Business incubators are organizations that support the entrepreneurial process, helping to increase survival rates for innovative startup companies. Entrepreneurs with feasible projects are selected and admitted into the incubators, where they are offered a specialized menu of Idealab. In court papers, Miller has alleged much self-dealing among Idealab executives, including founder Bill Gross. Idealab and Gross have publicly dismissed the shareholders suit and complaints as baseless, and have hired lawyer Michael Hennigan at Irell & Manella for defense. Miller advises private equity investors to be careful. Investors may wish to determine who sits on an audit subcommittee of a private company's board, and make sure the audit subcommittee represents shareholders, not management. Control of the board is another important consideration. Without control, private investors have little recourse except to civil courts if they suspect they are being had. They cannot go to the Securities and Exchange Commission, or stock exchanges, and complain of rule violations. And nearly all business litigators consider complicated cases an unpredictable adventure at best. Concluded Miller, "For private investors, proper corporate governance, board membership, and corporate bylaws The rules and regulations enacted by an association or a corporation to provide a framework for its operation and management. Bylaws may specify the qualifications, rights, and liabilities of membership, and the powers, duties, and grounds for the dissolution of an are even a bigger issue than for public investors." Contributing columnist Benjamin Mark Cole Mark Cole is a multi-instrumentalist blues and roots musician based in Gloucester, UK Music Mark primarily writes and performs blues music but also writes and performs music influenced by other American roots music genres such as americana, cajun, zydeco, bluegrass and can be reached at sevencontinents@mindspring.com. |
|
||||||||||||||||||||||||
Printer friendly
Cite/link
Email
Feedback
Reader Opinion