Ralph V. Whitworth delivers the keynote address at UD's Corporate Governance Conference.

Governance guidance

Finance, Weinberg Center host annual conference on corporate governance


11:59 a.m., Nov. 10, 2011--The effectiveness of corporate boards, the election of directors and the effect of litigation and the future of Delaware law were just some of the many issues discussed during the University of Delaware's annual Corporate Governance Conference held Friday, Nov. 4, in Alfred Lerner Hall on UD's Newark campus.

The conference, co-sponsored by the John L. Weinberg Center for Corporate Governance and the Department of Finance in the Alfred Lerner College of Business and Economics, hosted students, business leaders and academics from across the country to study these current and relevant topics.

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Corporation Service Company, a locally based provider of services to corporations, law firms and financial institutions, provided funding for the conference.

University President Patrick Harker welcomed attendees and noted the timeliness of the event.

“We find ourselves in an environment of dynamic change, which offers us an incredible opportunity to examine the legal, financial and practical ramifications of this new reality,” said Harker.

Bruce Weber, dean of the Lerner College, also noted the “superb forum for debate and discussion of the pressing issues facing corporate directors and the boards they serve on” that the Weinberg Center provides.

“The expectations and responsibilities of board members have grown substantially,” said Weber. “This annual conference succeeds in bringing an influential group to Lerner College for a day of provocative conversation around best practices and insightful research.”

Charles Elson, director of the Weinberg Center and Edgar S. Woolard, Jr., Chair in Corporate Governance, moderated the first panel of the day. 

To start, Elson shared Bridging Board Gaps, a report from the Columbia Business School and the Weinberg Center on how boards of directors can be more effective stewards of shareholder and corporate interests.

“A company should not fail because its board goes off track,” said Elson. “In this report, we examine what boards presently do and what they might do better based on shared best practices and 360 degree views from economists, governance professionals and investors.”

Elson then moderated a discussion of the results of the report by a panel of influential business leaders including the Honorable Carolyn Berger, justice, Supreme Court of Delaware; Ken Bertsch, president, Society of Corporate Secretaries and Governance Professionals; Ken Daly, CEO and president, National Association of Corporate Directors, Inc.; Richard Daly, president and CEO, Broadridge Financial Solutions, Inc.; Glenn Hubbard, dean of Columbia Business School; Peter Langerman, fund advisor, Franklin Mutual Advisors; the Honorable Don Parsons, vice chancellor, Delaware Court of Chancery; Damon Silvers, associate general counsel, AFL-CIO; A. Gilchrist Sparks, chairman of the Board of Trustees of the University of Delaware and of counsel at Morris, Nichols, Arsht and Tunnell LLP; and Ralph V. Whitworth, principal, Relational Investors, Inc. 

Following the morning sessions, Weber spoke with conference attendees over lunch in the Lerner Atrium, where he described the ways the Lerner College has begun to meet the challenges facing business schools and pointed to UD’s recent joint venture with JPMorgan Chase as a new model for university-business collaboration. 

Weber then introduced keynote speaker Ralph V. Whitworth, founder, principal and investment committee member of Relational Investors LLC, an investment fund specializing in strategic block investments.

Whitworth, who has served on the boards of ten public companies including such corporate giants as Mattel, Inc., Sprint Nextel Corporation and Sirius Satellite Radio, Inc., is considered an expert on corporate governance. 

“Ralph Whitworth needs no introduction at a governance meeting,” said Weber. “For the record, though, his firm Relational Investors has generated impressive returns by unlocking value in underperforming companies. 

“Relational achieves this through activist investing -- driving changes in corporate governance, and ensuring that boards ask hard questions and provide constructive criticism,” said Weber. “I look forward to hearing his secrets and applying them here at Lerner!”

Whitworth shared stories and lessons learned from his experiences as an activist investor, stressing the benefits informed shareholders bring to a company and its strategic direction and success.

“If I could point to one thing that I would say when asked how to make boards better, it would be to incorporate shareholder representation and participation in the boardroom,” said Whitworth.

Jay Coughenour, chair of the Department of Finance, later moderated a session in which leading finance academics, including John Bizjak of Texas Christian University, Yaniv Grinstein of Cornell University and Fabrizio Ferri of Columbia University, presented recent work on boards and shareholders.  

Roger Coffin, associate professor in the Department of Finance, moderated a panel on the topic of litigation and its impact on mergers and acquisitions under Delaware law.  The session featured the presentation of papers by Randall Thomas of the Vanderbilt Law School and Robert Thompson of the Georgetown University Law Center.

Weber praised the impact of the conference on both industry and the academy.

“This event shows that practitioners and academics are committed to improving the functioning of corporate boards, overcoming obstacles to change and seeing that shareholders and society obtain the benefits of proper governance of business organizations,” said Weber. “My hat is off to Professor Elson and to the presenters and participants for a valuable conference.”

Article by Kathryn Meier

Photos by Evan Krape

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