Corporate governance is an essential part of operating a corporation. The ideal governance structure strikes the right balance among the interests of the company’s various stakeholders while ensuring the profitability of the business. SederLaw’s Corporate Governance attorneys regularly advise companies on the best practices that will ensure they follow the law and abide by applicable rules and regulations. We draw upon our multidisciplinary experience to provide sound counsel to private companies, corporations, and not-for-profit entities of all types.
What Is Corporate Governance?
Now more than ever, governments, investors, and the public are scrutinizing the practices of businesses and non-profit organizations. There are laws and regulations that Massachusetts companies are expected to abide by. But these rules don’t necessarily apply equally, because some businesses are more tightly regulated than others. Companies that are not properly organized will likely fail to meet their obligations and expose themselves to significant liability.
Corporate governance aims to avoid this problem through the adoption of rules, policies, and other controls that companies implement to guide and manage their practices. Governance encompasses a diverse array of concerns, including but not limited to business ethics, risk management, corporate strategy, public relations, and much more. The ultimate aim of corporate governance is to achieve the company’s objectives through policies that promote fairness, accountability, and compliance with the law.
When used effectively, corporate governance will take into consideration the needs and interests of a number of stakeholders, such as:
- Senior management
- Executive leadership
- Third party vendors and contractors
- The surrounding community
- Government and regulators
Why Does Corporate Governance Matter?
Massachusetts corporations are expected to follow certain formalities in the way they conduct business. A corporation that disregards its own rules or neglects its legal obligations can not only risk the financial future of the business but open itself to litigation. In addition, corporate governance goes a long way in establishing and maintaining the company’s trust and integrity with the public.
While adhering to applicable legal requirements is a necessary component of responsible corporate governance, it isn’t enough. Ultimately, corporations are still businesses and must be mindful of competitors who are all too willing to exploit their weaknesses. A company that lacks adequate governance risks its own market dominance and, ultimately, its profitability. Corporations that wish to command a competitive advantage must therefore be good corporate citizens as well. That means adopting a governance strategy that reflects sound business ethics, transparency, dedication to and investment in the community, and other values.
These concerns are not limited to corporations and for-profit businesses. Charities, foundations, and other non-profit entities must consistently practice good governance to maintain public trust and fulfill their purposes. Those that don’t risk anything from reputation loss to criminal investigation.
How Can SederLaw Help My Organization?
A company’s board of directors is the primary factor in any corporate governance strategy. Our law firm also advises board committees, shareholders, senior management, and other members of corporate leadership as they adopt and execute governance practices. More specifically, SederLaw assists with the following:
- Drafting and execution of governance documents. Corporate governance begins with the implementation of documents such as articles of incorporation, bylaws, and operating agreements. We have experience in drafting and executing corporate governance documents and ensuring all responsible parties understand them.
- Internal investigations and reports. Corporations often engage SederLaw to conduct investigations aimed at uncovering deficiencies and determining the root causes of various problems. These inquiries may be the result of specific complaints, although some companies routinely employ them to ensure there are no hidden issues that could become controversies later.
- Advising on fiduciary duties. Boards of directors, officers, and shareholders owe certain fiduciary duties to their corporations. Failure to abide by these duties can set the stage for a major lawsuit that could be financially devastating to the company. Our firm will review your company’s business practices and ensure fiduciary duties are being followed.
- Compliance. Depending on the industry in which you operate, you may have a complex set of local, state, and federal laws and regulations that control your corporate operations. Violating these rules could result in fines, legal action, and negative public attention. We help corporations with all aspects of compliance.
- Monitoring and oversight. Directors and officers have important monitoring and oversight duties, ranging from proper recordkeeping and due diligence to risk management and audit responsibilities. The objective of these and other procedures is to prevent problems from happening in the first place so you can focus on making your business a success.
- Crisis response. We provide legal counsel during emergencies and other unexpected situations. These include but are not limited to shareholder activist campaigns, data breaches, cyberattacks, and more. Situations like these demand quick thinking and effective legal representation, and we’re prepared to take action.
- Governance for non-profit entities. Our broad experience with corporate governance places us in the position of being able to advise non-profit entities as well. Although these organizations face different challenges compared to for-profit corporations, they still need proper corporate governance in the areas of fundraising, board composition, and other issues.
SederLaw attorneys have considerable experience across multiple practice groups, including business and corporate, litigation, banking, finance, tax, and employment law. We approach every corporate governance matter as an opportunity to craft policies and guidelines that will secure the long-term interests and viability of the company.
Contact Our Corporate Governance Attorney Today
When you retain SederLaw, you have a partner that is ready to provide comprehensive guidance on all aspects of corporate governance. Let us show you how we can serve your organization today. Give us a call to schedule a confidential consultation.
SederLaw helps clients with corporate governance law in Worcester from their primary office as well as clients throughout MetroWest from their Westborough office.