Welcome to Manifest-I

Welcome to Manifest-I the blog of Manifest Information Services Ltd. Here we take a wide ranging view of topical governance and stewardship issues. Please feel free to add your comments and join the debate. Sign up to receive free weekly updates.

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In the pursuit of secure investment returns, diverse viewpoints based on high-quality data and varied information are critical for portfolio construction. We believe that share ownership is no different. Manifest intelligently navigates the complexities of global governance and voting delivering actionable and defensible stewardship insights.

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As board diversity stalls, new push to breakdown barriers and improve pipeline

After the initial push to increase board diversity over the past five years, progress appears to have slowed according to two reports published by the UK government and Cranfield School of Management.

The UK government has therefore launched a review focusing on increasing female representation to 33% of boards across the FTSE 350 by 2020.… Read the rest

UK's pay reporting rules did not curb executive pay

The initial response of the top UK companies to new reporting requirements was not to curb executive pay or improve the link CEO pay and firm performance at FTSE 100 companies, but led instead to “opportunistic reporting for the sake of reputation management,” says a study from Cambridge Judge Business School and King’s College London.… Read the rest

Broader skills needed to produce better audits in the future research finds

Changes may be needed to ensure audit teams have the right skills in the future and there needs to be an open and constructive debate on the future of audit findings from two international studies produced for the UK’s Financial Reporting Council and ICAS show.… Read the rest

Academics argue stop paying top executives for performance

Top executive pay should not be linked to performance as the work they do is difficult to measure and such pay may actually be damaging to companies, according to a recent article by two academics in the Harvard Business Review.

It is not unusual for 60-80% of the pay of chief executives and other senior leaders, to be tied to performance – whether performance is measured by quarterly earnings, stock prices, or something else, according to Dan Cable and Freek Vermeulen both professors at London Business School.… Read the rest

John Kay - Other People’s Money: Masters of the Universe or Servants of the People

There needs to be a structural shift in the finance industry, making it more limited in scale and more effectively directed to real economic needs, according to economist John Kay, in his latest book Other People’s Money: Masters of the Universe or Servants of the People.… Read the rest

US public believes CEOs are overpaid

The Rock Center for Corporate Governance at Stanford University has recently conducted a representative survey of 1,202 Americans to understand public perception of chief executive (CEO) pay levels among the 500 largest US publicly traded companies.

The survey found that 74% believe CEOs are not the right amount compared with the pay of an average worker – only 16% believe they are. … Read the rest

Slow increase in women on company boards in California

There has been a steady improvement in the number of women directors in California’s top 400 public companies according to research by the UC Davis Graduate School of Management.

California is a major force within the US economy and and the survey includes many global corporate giants such as Apple, Chevron, Intel, Visa, Google, Hewlett-Packard and Oracle — which together have a total stock market value of nearly $5 trillion.… Read the rest

What works for exec pay: Internal metrics or peer group benchmarks?

Are executive pay peer group benchmarks the new credit ratings?

New research from the Investor Responsibility Research Centre Institute (IRRCi) suggests that over-dependence on peer group benchmarking for setting executive pay is the root cause of pay inflation in the USA and that a holistic, business-centric approach to setting reward is needed by boards, investors and regulators, including the courts.… Read the rest

More Regulation or Better Stewardship?

Optimising the Means and Ends of Good Governance

Manifest is proud to sponsor the 4th Cambridge International Regulation and Governance Conference on September 6th, at Queens College, Cambridge.

In a timely intervention given recent consultations at national and supra-national level on both sides of the Atlantic touching on stewardship processes, the conference will address regulatory responses to aspects of the global financial crisis.… Read the rest

The Making of a Daredevil CEO: Why Stock Options Lead to More Risk Taking

New research from Wharton shows that stock options lead to more risk taking by CEOs.

The research is presented in a new paper, “CEO Compensation and Corporate Risk Taking: Evidence from a Natural Experiment,” by Gormley, David Matsa, a professor at Northwestern University’s Kellogg School of Management, and Todd Milbourn, a professor at Olin Business School at Washington University in St.… Read the rest