The Spencer Stuart Board Index is an annual study that examines the state of corporate governance among the S&P 500. The 2009 index looks at how boards have changed in the past 10 years and reveals several important governance changes in advance of proposed legislative reforms including:
- Majority voting: 65% of boards report that they require directors who fail to secure a majority vote from shareholders to offer their resignations. This is up from 56% last year.
- Director term limits: One-year terms for directors are now the norm in 68% of S&P 500 boards, versus 38% 10 years ago.
- Independent leadership: Half of all boards have only one insider, the CEO, up from 44% last year. And 37% split the chairman and CEO roles, versus 20% a decade ago.
Additionally, the profile of directors continues to evolve: Of the 333 new independent directors in 2009, just over one-quarter are active CEOs, COOs, or chairmen, down from 53% in 1999. Meanwhile, retired CEOs and leaders of divisions and functions now make up 17% and 21% of the new director pool, respectively.
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