Venture capitalist Arthur Rock and his wife, Toni Rembe, have donated $10 million to the Law School to launch the Arthur and Toni Rembe Rock Center for Corporate Governance at Stanford University. Established on the idea that progress in understanding and improving corporate governance is most likely to occur in a cross-disciplinary environment, the Rock Center will tap into the wealth of expertise in Stanford University’s leading graduate schools and programs, adding an important voice to the governance debate, both domestically and internationally. The Rock Center will provide a forum in which economists, lawyers, financial experts, political scientists, engineers, and practitioners can meet and work together to advance the practice and study of corporate governance.
“Innovation and new ventures fuel the global economy but the spark comes from investment,” Rock said. “Investment is about trust. It’s about knowing that the people investors entrust with their money are running ethical, transparent, and effective businesses. Stanford Law School has a demonstrated track record of leadership in the field of corporate governance. We are pleased to support their efforts.”
Officially launched earlier this year, the Rock Center is jointly directed by law school faculty members Robert Daines and Joseph Grundfest ’78 and David Larcker of the Graduate School of Business (GSB). Daines, the Pritzker Professor of Law and Business, also has an appointment by courtesy at the GSB. He is a former investment banker at Goldman Sachs and is widely recognized for his rigorous statistical analysis of empirical data on the relationship between economic theory and the operation of corporate institutions in practice. A nationally prominent expert on capital markets, corporate governance, and securities litigation, Grundfest is the W. A. Franke Professor of Law and Business at Stanford. He was a commissioner of the SEC from 1985 to 1990, and he launched both Stanford’s award-winning Securities Class Action Clearinghouse and its renowned Directors’ College. Larcker, the James Irvin Miller Professor of Accounting at the GSB, is a corporate governance and executive compensation expert who recently came to Stanford from University of Pennsylvania’s Wharton School.
Rock Center directors Robert Daines (top photo) and Joseph Grundfest (bottom photo)
Off to a Running Start
Pursuant to its multifaceted mission—furthering the understanding of the governance process, enhancing the quality of governance-related education, and ultimately improving the practice of corporate governance around the world—the Rock Center has already sponsored several highly publicized programs with such notable participants as SEC Chairman Christopher Cox, SEC General Counsel Brian Cartwright, Intel founder Gordon Moore, vice chancellor of the Delaware Court of Chancery Leo Strine Jr., venture capitalist Warren Hellman, legendary M&A lawyer Marty Lipton, and Economist columnist Matthew Bishop. Highlights from Rock Center events since the announcement of the gift in March 2006 include the following:
“Agency Capitalism: Issues on the Investor Side of Capital Markets,” held in March 2006, brought together approximately 45 prominent law firm representatives, members of the Delaware bar, academics, and institutional investors for a discussion of hedge funds and their influence on shareholder votes and corporate actions.
“Executive Compensation Disclosure: An Analysis of the SEC’s Proposed New Rules,” in April 2006, explored the SEC’s proposed disclosure rules on executive compensation. Providing a public forum in which regulators interacted with scholars and industry experts, the approximately 125 attendees heard panels of academics, lawyers, compensation consultants, and institutional investors discuss the proposed rules and offered insights into the information that investors need disclosed and in what form. The conference was addressed by Christopher Cox, chairman of the SEC, and John White, director of the Division of Corporation Finance at the SEC.
“Lucky Strikes: A Conversation on Option Backdating and Opportune Granting Practices,” in June 2006, brought approximately 60 Stanford Law School affiliates and lawyers from many Silicon Valley firms together to explore the issues of backdating and other grantpractices that have recently come under scrutiny. Presentations by faculty from the Graduate School of Business explored research efforts that have led to investigations of many companies and into other practices that may yet be investigated by regulators.
The “Best and Worst Ideas of Corporate Governance” panel discussion—held in June 2006 as part of the law school’s popular executive education program, Directors’ College—explored some of the best and worst ideas in corporate governance and offered suggestions on how to examine these issues in a more rigorous way. Chaired by the Stanford Program in Law, Economics and Business executive director, Dan Siciliano ’99, the panel discussion included Arthur Rock and Rob Daines and was attended by approximately 150 people.
The Rock Center is planning several more events that will examine corporategovernance and involve prominent practitioners, academics, and regulators at events at Stanford and elsewhere. For more information about the Rock Center and its events, visit www.law.stanford.edu/program/centers/rcfcg
David Larcker (right); Toni Rembe, Arthur Rock and Frank Roberts celebrate the launch of the Rock Center for Corporate Governance (left)