AT&T, Bank of America, Coca-Cola, IBM, Johnson & Johnson, P&G and Other Leaders Sign on to Updated Commonsense Corporate Governance Principles

The “Commonsense Principles 2.0” Build on National Conversation to
Promote Good Corporate Governance

Business Roundtable and The Conference Board Governance Center
Endorse Updated Principles; Millstein Center for Global Markets and
Corporate Ownership at Columbia Law School to Host Principles

Signers Endorse Work of Key Governance Groups and Call on US
Corporations to Join Them

NEW YORK–(BUSINESS WIRE)–CEOs of 20 leading public companies, pension funds and investment firms
today have signed the Commonsense Corporate Governance Principles 2.0
(“Commonsense Principles 2.0”), committing to using these standards to
inform the corporate governance practices within their own organizations.

The Commonsense Principles 2.0 are meant to promote a constructive
dialogue on good corporate governance to benefit the millions of
Americans who work for and invest in America’s public companies, create
economic growth, and sustain the health of America’s corporations and
markets. They are an updated version of the Commonsense Principles
successfully launched in 2016 to build momentum around the corporate
governance conversation.

List of Signers

As of today’s release, the following executives had signed the
Commonsense Principles 2.0 and Open Letter1:

  • Tim Armour, Capital Group
  • Mary Barra, General Motors
  • Edward Breen, DowDuPont
  • Warren Buffett, Berkshire Hathaway
  • Jamie Dimon, JPMorgan Chase
  • Mary Erdoes, J.P. Morgan Asset Management
  • Larry Fink, BlackRock
  • Alex Gorsky, Johnson & Johnson
  • Mark Machin, Canada Pension Plan Investment Board
  • Lowell McAdam, Verizon Communications
  • Bill McNabb, Vanguard
  • Brian Moynihan, Bank of America
  • Ronald O’Hanley, State Street
  • James Quincey, Coca-Cola
  • Brian Rogers, T. Rowe Price
  • Ginni Rometty, IBM
  • Charlie Scharf, BNY Mellon
  • Randall Stephenson, AT&T
  • David Taylor, Procter & Gamble
  • Jeff Ubben, ValueAct Capital
  • Theresa Whitmarsh, Washington State Investment Board

1) Names in bold type are new signatories

Key Endorsements

Business Roundtable and The Conference Board Governance Center have
endorsed the Commonsense Principles 2.0 which build on the robust public
dialogue that has taken place among key governance groups, investors and
other stakeholders since the Principles were first published in 2016.

Joshua Bolten, President & CEO of Business Roundtable, commented,
“Business Roundtable welcomes the Commonsense Principles of Corporate
Governance 2.0 and their emphasis on advancing both high ethical
standards and long-term economic value creation for the American people.
As the operating environment for U.S. public companies continues to
evolve, it is more important than ever for corporations, CEOs and boards
of directors to adopt and uphold meaningful corporate governance
practices. Business Roundtable supports the leadership and forward
thinking that the Commonsense Principles represent.”

Douglas K. Chia, Executive Director, The Conference Board Governance
Center, said, “We commend and support the persistent leadership of this
group to give actionable direction to boards and investors on governing
corporations for the long-term benefit of their key stakeholders.”

A Call to Action

The signers of the Commonsense Principles 2.0 are calling on all
companies and institutions that believe in the cause of good governance
to join their ranks by adding their names to the list of signatories.

Warren Buffett, Chairman and CEO of Berkshire Hathaway, and one of the
original signers, said, “Good corporate governance is critical to the
success of American companies and to the American economy overall. This
document takes it to another level of sound, commonsense principles that
have been endorsed by multiple prominent business leaders and investors.
It is a living document to help spur a larger conversation among boards,
investors and companies for the benefit of all Americans.”

Jamie Dimon, Chairman and CEO of JPMorgan Chase and Chairman of Business
Roundtable, said, “We’re pleased that some of America’s greatest
institutions have signed on to the Commonsense Principles — formally
joining a dozen others in our efforts to promote best-in-class corporate
governance. With the commitment of these additional signatories, the
endorsement from the BRT and The Conference Board Governance Center and
support from the Millstein Center, we are working hard to promote
principles that help drive the long-term strategy, healthy growth and
sustainability of America’s companies.”

Kristin Bresnahan, Executive Director of the Ira M. Millstein Center for
Global Markets and Corporate Ownership at Columbia Law School,
commented, “The Millstein Center is excited to host the Commonsense
Principles 2.0. The Commonsense Principles 2.0 represent an important
effort to bridge the divide between shareholders on the one hand, and
companies and their boards on the other, to promote sound, long-term
governance in our public companies.”

Companies and institutional investors who would like to sign on to the
Commonsense Principles 2.0 can do so by emailing Ms. Bresnahan at kbresnahan@law.columbia.edu
or at the link provided on the Millstein Center’s website.

Noteworthy Additions Included in Commonsense Principles 2.0

The updated principles released today incorporate a number of additions
and enhancements, including:

1) Board members should be prepared to serve for a minimum of three
years.

2) If board elections are not annual, companies should explain why.

3) Companies and shareholders are encouraged to engage early on
important proxy proposals.

4) Companies should allow some form of proxy access.

5) Poison pills and other anti-takeover defenses should be put to a
shareholder vote and re-evaluated by the board on a periodic basis.

6) Asset managers should disclose if they rely on proxy advisors to
inform their decision making.

7) Asset managers should disclose their conflict of interest policies in
their proxy voting and shareholder engagement activities.

8) Portfolio managers should be compensated based on performance over an
appropriate term, given the strategy and investment time horizon for the
portfolio.

9) Asset owners should promote sound, long-term oriented governance in
their direct interactions with both companies and asset managers.

10) Asset owners should use benchmarks and performance reports
consistent with their investment time horizon to affect governance
outcomes with asset managers and evaluate the asset managers’
performance on both investment returns and governance.

An Open Letter outlining the leaders’ thinking about the evolution of
the principles and the broader governance conversation and the updated
principles are available at https://millstein.law.columbia.edu/content/commonsense-principles-20
and http://www.governanceprinciples.org/.

Contacts

Sard Verbinnen & Co
Margaret Popper / Andy Duberstein
CorpGov-SVC@sardverb.com
Phone:
(212) 687-8080

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