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RI Governance, Feb. 2: MSCI’s governance earnings slip in fourth quarter

RI’s regular review of governance developments

MSCI’s governance segment adjusted earnings slipped in the fourth quarter of 2011 to $6.7m (€5.1m), down 20.1% on the comparable 2010 quarter – according to the company’s latest earnings report released today. Revenues for the division, essentially the Institutional Shareholder Services business which provides proxy research, voting services and advice, rose $0.3m, or 1%, to $28.6m.

Forty-eight of the 100 largest Swiss listed companies will propose an advisory vote of their executive remuneration at their 2012 annual general meetings, up from 45 last year. So says Ethos, the Swiss pension-fund owned foundation which has written to the chairmen of 56 listed companies that were not in line with certain best practice standards with regard to general meetings. Link

The $144.8bn California State Teachers’ Retirement System (CalSTRS) has released an analysis of shareholders’ ability to vote on executive compensation (“say-on-pay”), during the 2011 proxy season. Of the 2,166 say-on-pay proposals from the beginning of January through the end of June 2011, CalSTRS voted “for” nearly 77% and “against” 23%. Link

Russia has criminalized paying bribes abroad, a problem than anti-corruption analysts said gave Russian business an unfair global competitive advantage. President Dmitry Medvedev announced the signing into law of the Anti-Bribery Convention of the Organization for Economic Co-operation and Development (OECD) on Wednesday. Convention signatories are to formally punish their citizens for paying bribes outside their country, which previously was not a crime in Russia, said Yelena Panfilova, head of the Russian branch of Transparency International. China is now the only major economy to not have signed up – although it is fast-tracking the process.

Research in Motion, the maker of the Blackberry smartphone, has released its long-awaited governance review report – instigated after engagement from Canadian fund firm NEI Investments. RIM has installed Barbara Stymiest, former head of the Toronto Stock Exchange, as independent chair while Jim Balsillie and Mike Lazaridis have stepped down as co-chairman and co-CEO.US sustainable funds firm Trillium Asset Management is among a group of investors who have written to 18 companies based, or with a strong presence, in Washington State, to encourage them to support legislation allowing lesbian and gay couples to marry. Link

The $49.6bn (€38.6bn) State of Virginia Retirement System and Canada’s Alberta province have been confirmed as lead plaintiffs in the class action case against failed trading firm MF Global. Judge Victor Marrero in the Southern District of New York also named law firms Bernstein Litowitz Berger & Grossmann (BLBG) and Labaton Sucharow as co-lead counsel.

The New York Stock Exchange has issued an Information Memo to its members stating that, effective immediately, brokers may not vote on corporate governance proposals supported by company management without specific instructions from their clients.

The €246bn Dutch civil service pension fund ABP has filed suit against investment bank Goldman Sachs, accusing Goldman of making false or misleading statements in selling residential mortgage-backed securities. ABP has previously sued Deutsche Bank and J.P. Morgan Chase for similar reasons.
Securities class action filings in Canada reached their highest level to date in 2011 with 15 new filings, according to NERA Economic Consulting’s annual report, Trends In Canadian Securities Class Actions: 2011 Update. The previous high was 12 filings in 2008. Link

The Spanish government is considering limiting independent directors’ terms to 12 years, according to an ISS blog post. The issue is on the agenda of the new Popular Party administration.

Shareholders are pressing UK media group Trinity Mirror to limit the pay of chief executive Sly Bailey, according to the Financial Times. The unnamed investors are to set out their objections in meetings with the company’s new chairman David Grigson, the FT said.
The Los Angeles city attorney has filed a lawsuit against Northern Trust alleging its investment practices cost the Los Angeles City Employees Retirement System $95m, according to a Los Angeles Times report. It said the suit claims the bank wrongly invested in consumer debt and failing home mortgage-backed securities.