Corporate governance is the system by which a business is directed and controlled. The corporate governance structure specifies the distribution of rights and responsibilities among different participants in the company, such as the board of directors, managers, officers, and shareholders, and establishes the rules and procedures for making decisions on corporate affairs. Good corporate governance is key to the integrity of corporations, financial institutions, and markets, and central to the health of our economies and their stability.
In the wake of disasters such as Enron and WorldCom, it is more important than ever to ensure companies have the right checks and balances in place to avoid wholesale fraud or abuse of office. The roles of boards of directors, board committees, individual directors, and executive officers have always been challenging. Congress, the Securities and Exchange Commission, and the stock exchanges have expanded materially the responsibilities of directors and executive officers of public companies and imposed upon them significant potential liabilities.
For all of these reasons, it is important for companies to find excellent corporate governance counsel to represent the company and its board of directors and committees. Corporate governance lawyers should have extensive experience in advising boards of directors, board committees, and executive officers as the boards perform their duties in all types of situations, both extraordinary and routine. These boards and committees need attorneys who are thoroughly versed in traditional corporate fiduciary standards, as well as in the extensive and ever-changing body of legislation, regulation, and listing standards that both define and shape the responsibilities of directors and officers of companies.
Tonya Mitchem Grindon, Chair of Securities/Corporate Governance practice group