Such a board of directors is elected by shareholders and is charged with fiduciary and legal responsibilities to govern the corporation including the hiring and firing of the CEO.
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The external auditor is hired by the independent Audit Committee of the Board of Directors on behalf of the shareholders to present an unbiased and independent evaluation of the fair presentation of financial information by management.
Usually the fate of corporate executives is the exclusive province of the shareholders and their elected representatives on the board of directors.
As owners, shareholders elect a board of directors and vote on company business.
We expect the Board of Directors to satisfy its fiduciary obligations to all shareholders and to consider superior alternatives that treat public shareholders fairly.
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At companies owned by private equity, the board and the shareholders are one and the same: their directors are hardly under the thumb of managers.
According to a 2007 study by Corporate Board Member and PricewaterhouseCoopers, directors rate the community and activist shareholders as eighth and ninth in a list of nine most important constituencies they serve.
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Any company opting to sell shares in Shanghai would have to explain to board directors and shareholders why it chose to forgo the cheaper cost of capital.
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It's clear that board directors now need to fully understand the implications of their performance and their responsibilities to shareholders.
The Board of Directors appears to have dismissed better alternatives for public owners and selected a transaction, which has been publicly derided by shareholders as opportunistic and grossly undervalued, that favors management.
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One law firm has already opened an investigation as to whether the Weiss family and the Board of Directors of AM are breaching their fiduciary duties by not engaging in a full and fair independent auction to ensure that shareholders will receive the highest price possible for their shares.
Not long after my last post (October 19), which concerned the tenuous relationship between the Hewlett-Packard board and former CEO Mark Hurd, came word that a group of shareholders have sued current and past H-P board members, including Hurd, alleging that directors allowed and possibly encouraged illegal activities in sales to the U.S. government.
Mr. Nemer says the Cole Credit special committee that approved the transaction, and rejected the rival bid, was comprised of the board's three independent directors who had been approved by shareholders.
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