Introduction

There is a sign on the door at each end of every New York City subway car that alerts passengers, “Riding or moving between cars is prohibited.” The reason for curbing what was once a common practice of city straphangers¹ is—it's hazardous!² This may sound crazy, but being a corporate secretary at a corporation can at times feel like riding between cars. How so?

Over the past two decades³ we have witnessed an increasingly sharp focus on corporate governance, particularly at public companies. Not just shareholders, but all stakeholders, including politicians and mainstream media, have heightened their expectations for the role the board of directors plays in overseeing the company's management and how it functions, particularly in its monitoring role. In what at times looks like an epic battle for control over public companies, shareholders have sought more legal rights and say in decision-making at the public companies in which they invest. When shareholders have not been able to gain or assert those rights, they have come up with other ways of getting the attention of and influencing the board.

One storyline that has been hidden from view during that same period is the expansion of the job of the corporate secretary and the ramp-up in its intensity. Once seen as a job with few critical responsibilities beyond the “care and feeding” of the company's directors and serving as a scribe at board meetings, the corporate secretary has evolved into a key focal point within a public company and the internal gear-hub of corporate governance. Shareholders have broadened the scope of their demands on boards, and corporate secretaries are now being asked to provide input and advice on areas far afield from matters of the board and traditional corporate law and governance.

Legal Origins

While the law in a majority of states, including Delaware, now permits a corporation to designate all the particular officers it desires to have, early versions of the Model Business Corporation Act and the laws of many states required every corporation to have specified officers, typically a president, one or more vice presidents, a secretary and a treasurer. Any two officer positions could be held by the same person, except the president and secretary.⁴ Today, 13 states still require the appointment of a secretary.

Typically, the secretary's primary duties, as set forth in the corporation's bylaws, would include preparing minutes of the board, board committee, and shareholder meetings and maintaining and authenticating the records of the corporation required to be kept under state corporate law.

In general, unless express or apparent authority is conferred upon a secretary, he or she has no power to bind the corporation. Common law, however, expanded the secretary's legal authority to include (1) executing a guarantee on another corporation's behalf when all the shareholders are fully informed and the guarantee is in the business's best interests; (2) having custody of the corporation's records and certifying excerpts from those records; (3) binding the corporation in business matters when the corporation entrusts him or her with the management of its business; and (4) affixing the corporate seal.⁵

Duties, Powers, and Responsibilities

The duties of all corporate officers are set forth in a corporation's by-laws. Several examples illustrate the duties and powers of the corporate secretary of a large public company.

The Chemours Company (incorporated under the laws of the State of Delaware):

• Attend all sessions of the board and all meetings of the stockholders and record all votes and the minutes of all proceedings in a book to be kept for that purpose.
• Perform like duties for committees when required.
• Give, or cause to be given, notice of all meetings of the stockholders and meetings of the board.
• Perform such other duties as may be assigned by the board.
• Keep in safe custody the seal of the Corporation and have authority to affix the seal to all documents requiring it and attest to the same.

General Electric Company (incorporated under the laws of the State of New York):

• Record in proper books to be kept for that purpose and have custody of the minutes of the meetings of the shareholders of the Company and of meetings of the board of directors and of committees of the board (other than the compensation committee).
• Be responsible for the custody and care of the seal of the Company.
• Attend to the giving and serving of all notices of the Company.
• Perform such other duties as may be imposed upon him by the board of directors.

Johnson & Johnson (incorporated under the laws of the State of New Jersey):

• Attend all meetings of the shareholders, and of the board of directors.
• Keep and preserve in books of the Corporation true minutes of the proceedings of all such meetings.
• Have the custody of all valuable papers and documents of the Corporation.
• Keep the Corporation's share books, share ledgers, and share transfer books.
• Prepare, issue, record, transfer, and cancel certificates of shares as required by the proper transactions of the Corporation and its shareholders unless these functions be performed by a duly appointed and authorized transfer agent or registrar other than this Corporation.
• Keep in his or her custody the seal of the Corporation.
• Have authority to affix same to all instruments where its use is required.
• Give all notices required by statute, by the Certificate of Incorporation, or by the By-Laws.
• Have all powers and shall perform all duties commonly incident to and vested in the office of Secretary of a corporation.
• Perform such other duties as the board shall designate from time to time.

In addition to the by-law duties and responsibilities, a list published by the Society for Corporate Governance⁶ fills out the rest of the corporate secretary's responsibilities:

• Manage all board and committee meeting logistics; attend and record minutes of all board and committee meetings; facilitate board communications.
• Advise the board on its roles and responsibilities.
• Facilitate the orientation of new directors and assist in director training and development.
• Responsible for corporate disclosure and compliance with state corporation laws, stock exchange listing standards, and SEC reporting and compliance.
• Oversee Stockholder Relations, including stock issuance and transfer operations; stockholder correspondence; prepare and distribute proxy statement.
• Manage process pertaining to the annual shareholder meeting.
• Subsidiary management and governance.
• Monitor corporate governance developments and assist the board in tailoring governance practices to meet the board's needs and investor expectations.
• Serve as a focal point for investor communication and engagement on corporate governance issues.

Narrative Descriptions by Experts

Narrative descriptions of the job of the corporate secretary by experts in the field go well beyond what the law and by-laws set forth and provide a sense of the complexity and substantive importance the role has taken on in modern times.

A description written by the Society for Corporate Governance portrays the corporate secretary as the corporate officer who generally “works closely with a company's Board of Directors, its CEO, and senior officers, providing information on board best practices and tailoring the board's governance framework to fit the needs of the company and its directors, as well as the expectations of shareholders. The secretary also supports the board in the carrying out of its fiduciary duties. The actual work of the secretary falls into many ‘buckets’ and varies from company to company.…In most companies, the secretary serves as the focal point for communication with the board, senior management, and shareholders, and plays a significant role in the setting and administration of critical corporate matters.”⁷

Another expert's description says the corporate secretary “could be considered the glue that holds an entire corporation together.”⁸ Still another noted authority describes the corporate secretary as one who “serves as a confidante and resource to the board and senior management” and “has emerged as a senior, strategic-level corporate officer who plays a leading role in the company's corporate governance.”⁹

One prominent corporate attorney notes that “[t]oday, the corporate secretary of a public company also typically fulfills the duties of a chief governance officer, regardless of whether that title is formally applied … [and] is often the primary contact for shareholders and their proxy advisors.”¹⁰ Another explains that “the rise of shareholder engagement [has] resulted in a fundamental shift in the role of the corporate secretary.… As a primary liaison with investors who is also close to the board and senior management, the corporate secretary is ideally positioned to help directors and chief executives understand and respond to shareholder concerns. Corporate secretaries are expected to monitor corporate governance developments generally and assist the board in regularly updating and refining the company's governance practices as appropriate.” This in turn requires the corporate secretary to “purposefully build relationships with large shareholders, institutional investors, and proxy advisors, in order to be fully up-to-date on the general trends and specific issues that concern both active and activist shareholders, as well as the agendas of key participants in the corporate governance debate.”¹¹

Expansion of the Role

The drivers of the expansion of the corporate secretary's scope and volume of duties and responsibilities largely trace those that increased the demands placed on boards of directors in the wake of highly publicized corporate failures related to accounting (e.g., Enron, WorldCom, Global Crossing), internal controls and procedures (e.g., Tyco), and risk-taking in the financial services industry (e.g., Lehman Brothers, AIG, Countrywide Financial). The primary responses to these failures came in the form of federal legislation, namely the Sarbanes-Oxley Act of 2002 and the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.

Other regulatory developments contributed to the increased demands on the corporate secretary, including the promulgation by the U.S. Securities and Exchange Commission (SEC) of Regulation Fair Disclosure (FD) in 2000, the SEC's overhaul of its executive compensation disclosure rules in 2006, and rules emanating from Sarbanes-Oxley and Dodd Frank.

All of this meant more intensive work for the corporate secretary to ensure boards comply with these new mandates.¹² Corporate secretaries started to spend much more time gathering information about their directors, developing formal policies and processes for board practices and SEC disclosures, ensuring those policies were followed and processes were carried out, and documenting all of this for internal and external audits and potential legal challenges. This significantly increased the portion of the corporate secretary's time and mental energy required to interpret and comply with new and changing laws and regulations. Corporate secretaries quickly become in-house specialists, and people newly appointed to the position with no previous exposure to corporate and securities law found the learning curve steeper than expected. Some of the larger public companies decided to create new assistant secretary positions—also corporate officers appointed by the board—to be filled by people, usually lawyers, already experienced in the field to be responsible for handling the corporate secretary's day-to-day workload.

Best Practices

As companies adopted the new legal and regulatory requirements, the related corporate public disclosures gave shareholders and peer companies a much clearer view of the range of corporate governance and public disclosure practices in the marketplace, from companies implementing the bare minimum to comply with the law, to the prevailing market practices, to what were held out as “best practices.” Not surprisingly, shareholders started to put pressure on all companies to adopt best practices, which were oftentimes defined by aggressive activists armed with shareholder proposals and bolstered by increasingly influential proxy advisory firms. Corporate secretaries quickly became the natural liaisons to these actors.

As shareholders increasingly called for more regulation and applied pressure for best practices—a moving target that only ratcheted up—boards felt they were being overburdened with check-the-box compliance items that were more form over substance. A common phrase used in boardrooms for best practices was “solutions in search of problems.” Why not adopt them anyway? “We don't want to ‘lead with our chins’” or “be on the ‘bleeding edge’” were common responses from board members.

Longer-tenured directors had seen the same shareholders come back year after year demanding new, well-meaning corporate governance reforms regardless of whether the company had adopted the last ones or had any “problematic” practices. In fact, some observers noticed the phenomenon of companies that were quick to adopt new, shareholder-suggested best practices becoming magnets for shareholder proponents looking for willing participants to adopt the latest and greatest.¹³ Those directors were largely correct. Any credit received for setting gold standards ended up being worth very little when things went south in other areas. “No good deed goes unpunished” was the go-to phrase.

Unfortunately for the corporate secretary, he or she had the job of reporting to the board the best practices demanded by the company's shareholders and then reporting back to those shareholders that the board did not want to adopt them. How many ways can you politely say, “Go pound sand”?

The new legal and regulatory requirements all fell under the monitoring responsibilities of the director's job. Boards became frustrated that more of their bandwidth was being used for monitoring than strategy, which is where board members feel they add the most value. The most frustrated of all were members of the audit committees, whose agendas and meetings kept getting longer as many of the new compliance items naturally fit within that board committee's remit.

While policymakers were the creators and enforcers of the new requirements, boards saw the proxy advisory firms as the creators and enforcers of “best practices,” whispering them in shareholders' ears. “What is ISS¹⁴ going to say?” and “What do we have to do to make ISS happy?” were common questions in the boardroom, particularly in compensation committee meetings, demonstrating the growing influence the proxy advisory industry. For the corporate secretary, this meant spending more time with the proxy advisory firms' proxy voting guidelines, following the amendments and new policies released each year (sometimes providing formal feedback on them), talking to peers about different approaches to avoiding or handling adverse voting recommendations, and, for some, engaging directly with the policy heads of the proxy advisory firms.

Shareholder Engagement

Engaging with proxy advisory firms, however, was not to be the corporate secretary's most outward-facing responsibility; building relationships with large institutional shareholders and shareholder proponents was. Shareholders were frustrated with what they saw as the misguided practice of corporations having their representatives speak with ISS as a proxy for the actual shareholders, again showing the growing (some would say outsized) influence of the proxy advisory industry. Understandably, every shareholder wanted their portfolio companies speaking directly with them. From the company perspective, they wanted to deal with the actor perceived to control 15 to 25 percent of shareholder votes.

With a range of shareholders demanding an audience from companies, and the corporate secretary being the primary liaison, the corporate secretary's shareholder engagement duties became more time-consuming and labor-intensive. It was not uncommon for a corporate secretary to make calls to their company's 50 to 100 largest shareholders each year in the run-up to the annual meeting. The more well-resourced secretaries started calling or arranging to meet in-person with these shareholders on multiple occasions throughout the year, spending the time and energy needed to develop real working relationships.

During the time between the passage of Sarbanes-Oxley and Dodd-Frank, the number of shareholder proposals submitted to companies went up by over 15 percent, from 878 in 2003 to 1,014 in 2010, with a peak of 1,138 in 2008.¹⁵ Especially popular were those related to majority voting and executive compensation. Post Dodd-Frank, proposals related to proxy access and environmental and social issues moved to the forefront. More shareholder proposals meant more time the corporate secretary spent with shareholder proponents and outside counsel who drafted letters formally requesting the SEC to take no action if the targeted companies were to omit the proposals from their proxy statements in accordance with SEC rules. For the corporate secretaries willing and able to do the work, which could often be adversarial in nature, engaging with shareholder proponents to seek common ground paid off for their companies, either in the short-term or long-term. Even if they were unsuccessful in finding ways to satisfy the proponents, such that the proponents withdrew their proposals, they developed relationships with those shareholders that would smooth future engagements.

Pre-Dodd-Frank, engaging with shareholders over shareholder proposals and proxy advisory firm voting recommendations had always been the domain of management. Post-Dodd-Frank, more shareholders demanded access to the board of directors for discussions of this nature. Directors and management did not consider this part of the (unwritten) job description of the public company director, at least not in the United States, but shareholders were becoming insistent that this was a right they had as the voters who elected the directors. Still, directors were able to keep the shareholders at bay and continued to rely on their corporate secretaries as their dutiful liaisons. This would not last for much longer.

Say on Pay

The catalyst for directors becoming personally involved in real-time engagement with their shareholders was the required periodic advisory vote to approve executive compensation that become law under Dodd-Frank in 2010, commonly referred to as “say on pay.” The first of the say on pay votes took place at annual meetings in 2011. It proved to be a game-changer for shareholder engagement that would impact corporate governance well beyond executive compensation.

For the first time, directors found it necessary to meet directly with their shareholders, specifically to discuss executive compensation. Many of them chafed at the notion this was part of the job, but no board wanted to “lose” the say on pay vote, or even receive a level of support less than 90 percent. With average public company CEO pay having climbed to record levels starting in the mid-1990s, executive compensation was a sensitive subject for directors. Shareholders wanted to talk to independent members of the board compensation committees in the absence of any executive whose pay was disclosed in the proxy statement. The corporate secretary naturally fit the role of chaperone for director calls and visits with shareholders. Sitting as an observer in these director-shareholder meetings, the corporate secretary was in the room for discussions that their CEO could never witness.

Given the highly sensitive and unsupervised nature of director meetings with shareholders, management wanted their directors to be extremely prepared for any and all questions the shareholders might ask them. They needed to plan out which directors would attend, who would lead off and what would they say, which directors would answer which types of questions, and what the answers should sound like (or how they should be scripted). Everything relating to these meetings—scheduling, logistics, talking points, Q&A, agendas, pre-meeting preparation and post-meeting debriefs of the directors, documenting and reporting back to the board—fell to the corporate secretary, with input from human resources on the more technical matters of executive compensation.

Investor Relations

An untrained eye scanning a roster of corporate executives looking for who would be the most logical one to facilitate meetings with the company's largest institutional shareholders would surely be drawn to “vice president, investor relations” over “general counsel,” “corporate secretary,” or just about any other title. The words “investor relations” sound virtually synonymous to “shareholder engagement,” especially engagement with institutional shareholders. Here is where the title “corporate secretary” has become outmoded in light of the expansion the position's role vis à vis institutional shareholders at public corporations.

Investor relations officers focus on engaging with the “sell-side” research analysts, who follow the company's quarterly earnings reports and recommend to clients whether to buy, sell, or hold the company's stock, and the portfolio managers who also follow the company's financial reporting and actively pick stocks for their funds. Neither investor relations officers nor chief financial officers spend much time building relationships with the “passive funds”—those institutional asset owners and managers who rely heavily on indexed investing, which includes the world's largest mutual funds, exchange-traded funds, and pension funds. This means the corporate secretary is likely the one person in management with established relationships with the company's largest institutional shareholders and the most logical one to facilitate meetings with them.

Profound shifts in the investment industry, starting in the 1980s and accelerating dramatically after the 2008 financial crisis, led to large flows of capital into index funds to the point where the largest index fund managers are the largest shareholders of swaths of companies across the equity markets.¹⁶ BlackRock, State Street Global Advisors (SSga), and The Vanguard Group¹⁷ are for director elections, say on pay, and shareholder proposals what California, Texas, and Florida are for U.S. presidential elections. Sure, it is possible to win without the electoral votes from any of those three states, but it would be pretty darn hard to pull off.¹⁸

Through their work on shareholder engagement for say on pay and shareholder proposal votes, corporate secretaries have become the primary relationship owners at their companies for the passive funds. Senior management at companies that have become more concerned about how these passive funds cast their proxy votes on say on pay, shareholder proposals and director elections, and the increasing number of proxy fights threatened by activist hedge funds, have started to understand the importance of the corporate officer previously thought to be not much more than a scribe with gray hair and people skills.

As shareholder engagement has become part of the unwritten job description of the public company director, and say on pay discussions have normalized, the largest institutional shareholders have shifted their priority discussion items for meetings with directors from executive compensation and structural corporate governance to long-term business strategy, asset-allocation, cybersecurity, human capital management, and environmental, social, and sustainability issues. Covering these topics with boards and shareholders requires expertise beyond what the corporate secretary is typically intimately familiar with, prompting corporate secretaries to reach out to subject matter experts and functional area heads in different parts of their companies for knowledge and support.

The cumulative effect all these developments is the heightened profile and importance of the corporate secretary, which in effect has become an office with significant power. That power (whether real or perceived) emanates from the corporate secretary spending more time with their boards and C-suite executives when critical decisions are being made, developing relationships with and facilitating discussions between board members and shareholders representing trillions of dollars of equity securities, becoming a familiar face to the heads of corporate functions of increasing interest to shareholders, and holding the pen in drafting public disclosures receiving more shareholder attention and public scrutiny.

Straddling

The increased responsibility of the corporate secretary to act as an advisor and liaison for stakeholders with enterprise decision-making power creates a serious occupational hazard for the person who holds that office: the risk of being pulled in different directions by multiple bosses at the highest levels with conflicting interests. Primarily working with the board and the most senior management, and also having a relationship with the largest shareholders, corporate secretaries can feel like they are “straddling”—standing on the gangway between two subway cars with one foot on each. Those two cars are going in the same direction at high speeds, connected by what appear to be strong couplers and chains. While it shouldn't happen, what do you do if that connection system fails and those two train cars start to move apart with you as the only thing left connecting them? (Using the Force is not one of your options.)

On those occasions where the corporate secretary is challenged to satisfy multiple corporate stakeholders with divergent views, an important question arises: For whom does the corporate secretary work?

The secretary's primary function is to ensure the board has what it needs to fulfill its fiduciary duties. He or she is appointed to that office by the board of directors and has all the same fiduciary duties as the other corporate officers.

In most public companies, the corporate secretary is a full-time employee who is hired, paid, and fired by management, typically the general counsel with significant input from the CEO. Very often the general counsel is appointed to be the corporate secretary and will include that in his or her formal title (e.g., Jennifer Lee, executive vice president, general counsel, and corporate secretary). Other times, the corporate secretary is a separate employee who is part of the legal department and reports to the general counsel.

In the case where the general counsel and corporate secretary are both lawyers, what if their interpretations of the law or SEC regulations as they apply to the actions of the board differ? When the corporate secretary is the general counsel,¹⁹ this disappears. But, with more companies creating a separate corporate secretary position to deal with the increasing amount of work resulting from the increased demands on the board, there becomes real potential for conflict, and that conflict can put the corporate secretary in difficult positions.

To whom corporate directors and officers owe their fiduciary duties is an age-old debate that has picked up steam in recent years. “Shareholder primacy” has been the prevailing view since the early 1970s with most businesspeople and shareholders believing the duty of directors and officers is to maximize shareholder value and thus the duties are owed to the shareholders and them alone. This theory was most famously articulated by Milton Friedman in a piece published by the New York Times in 1970.²⁰

In recent years, however, the “stakeholder” model of corporate governance has made a comeback. According to this school of thought, the duty of directors and officers is to create sustainable long-term value for the corporation, taking into account the interests of its multiple key stakeholders, usually categorized as its customers, employees, communities, and shareholders—in that order! This theory is not new, having been articulated by the Johnson & Johnson Credo,²¹ which was written in 1943 by then-Chairman/CEO General Robert Wood Johnson just before the company's shares became publicly traded. Perhaps the most significant post-Friedman articulation of stakeholder-based corporate governance can be found in BlackRock Chairman/CEO Larry Fink's 2018 letter to CEOs, which he titled “A Sense of Purpose.”²² In this letter, Fink writes,

To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.

Certainly, when the largest asset-manager on the planet Earth takes a contrarian view to shareholder primacy, a watershed moment has taken place!

As for to whom the corporate secretary owes fiduciary duties, he or she takes their cues from the board. In a scenario where management and the board do not see eye-to-eye, whose “side” is the corporate secretary on? The likely answer is the “corporation's side.” Does that mean the board's side given the corporate secretary's primary role is to serve the board? Could there be a situation where the general counsel wants to swap out the current corporate secretary for someone else, or take the title for himself or herself, but the board overrules because it likes the current one? Right here we see some ambiguity in who the corporate secretary's real boss is.

Now let's tie this to the straddling concept described above. Here are several “what-do-you-do?” situations where ambiguity can make the corporate secretary feel like they are riding between cars:

1. The corporate secretary is drafting proxy statement disclosure about the CEO's compensation, which disclosure must be approved by the board's compensation committee and filed with the SEC. The corporate secretary knows how the committee would like the explanation for why it set the CEO's compensation to read, but also knows his or her boss, the general counsel, will likely want it watered down when he or she reviews the draft before it goes to the board.
2. The corporate secretary includes a piece of information in a packet of materials being sent to the board ahead of a meeting. Upon previewing the materials, the CEO tells the corporate secretary to remove it from the packet because it is “not something that the board needs to see.” The corporate secretary, however, feels it is something material that the board either would want to see or really should see as part of their oversight duties.
3. The board has chosen to retain an independent compensation committee consultant whom the CEO and other senior officers think is the wrong choice, based on their interactions with that consultant, and want to persuade the committee chair to look at a different one they think “understands the company better.” The corporate secretary believes this would be improper and potentially taint the consultant's independence.
4. A major shareholder proposes a policy that would strictly prohibit “gross-ups” in executive compensation and benefits arrangements, including existing arrangements. The secretary first runs it by the CEO, chief human resources officer, and general counsel, who all think this is an outlandish idea that doesn't need to be passed on to the board, especially since the board has a history of summarily dismissing just about every proposal made by this particular shareholder about executive compensation. The corporate secretary feels he may be abdicating his own fiduciary duty by failing to pass on the proposal or slow-walking it to the compensation committee.

In each of these scenarios, what is the corporate secretary to do? Of course, the answer is to do what he or she believes is the “right thing,” but that could easily be a “career-limiting move” or worse. There are plenty of ways of looking the other way or passing the decision up the chain for someone else to make, but those are defaults to management's side. And what about the shareholders? If you subscribe to shareholder primacy, the secretary might have an obligation to take their side.

How do you fix this? Some companies have experimented with naming the corporate secretary as “secretary to the board,” making it clear to whom that person reports. This is akin to how the position works in the UK. But, this practice is very seldom seen in the United States.

Another way is to outsource the position to a third party, such as a law firm. This does happen in smaller companies where the general counsel doesn't have the bandwidth to perform the duties of the corporate secretary, but also doesn't have the budget to create a separate headcount to do the work.²³ But, whether this issue is fixed will depend on who engages that third party. Typically, the general counsel engages that law firm. There goes your independence.

Future of the Role

With interaction among the board, management, and shareholders continuing to increase, the spotlight on their decisions becoming brighter and the larger philosophical battle over who controls and has ultimate decision-making power over the corporation becoming more out in the open, the intensity and pressure of corporate secretary's job will correspondingly increase.

As environmental, social, and sustainability issues move to and remain at the forefront of corporate governance, the corporate secretary will be pulled into meetings of more internal advisory boards, steering committees, and working groups throughout the corporation. Though the corporate secretary may have little to no subject matter expertise to offer at those meetings, it is axiomatic that just being in the room changes the dynamics and influences the discussion. Once the other attendees realize the corporate secretary is there because the board and the company's largest shareholders are interested in what is on that meeting's agenda, whether it be climate change, cybersecurity, privacy, human capital management, cryptocurrency, or artificial intelligence, they will start to appreciate the importance of this corporate officer position, about which they likely know very little.

The unfortunate truth is that, when allocating resources, companies do not place corporate governance or sustainability at or near the top of the priority list, regardless of what they might say in public about how important these are to the company. Quantifiable assets and financial performance always win out. Even for companies that preach stakeholder governance and stewardship, shareholder pressure for financial performance is too intense to hold off. Boards will likely be slow to realize their companies need to devote more resources to these areas, but when the lightbulb moment arrives, they will be reluctant to direct management to do it until there is a governance failure, shareholder activist threat, or public relations crisis. In the meantime, the corporate secretaries will have to triage.

The challenges for the board and corporate secretary generated by these trends will also create opportunities for corporate secretaries to interact with a broader set of corporate leaders and understand more parts of their companies' businesses and larger business strategy. This may lead to being given more responsibility, like ownership of corporate sustainability, which will be excellent grooming for positions higher up in the organization. The corporate secretary position can be a great steppingstone for someone with their eye on the C-suite. The experience of riding between cars will test and ultimately benefit that person as they traverse the highest levels of corporate America. Just don't spend too much time looking down at the tracks.

About the Author

Douglas K. Chia, a well-recognized and respected corporate attorney and governance professional, is president of Soundboard Governance LLC, through which he performs a range of corporate governance consulting, research, and writing. Mr. Chia is a fellow at the Rutgers Center for Corporate Law and Governance and senior fellow for The Conference Board ESG Center.

Prior to forming Soundboard Governance, Mr. Chia has been executive director of The Conference Board ESG Center, assistant general counsel and corporate secretary of Johnson & Johnson, and assistant general counsel, corporate of Tyco International. Mr. Chia began his legal career at the global law firms Simpson Thacher & Bartlett and Clifford Chance, both in New York and Hong Kong.

Mr. Chia has held a number of central leadership positions in the corporate governance field, including chair of the board of the Society for Corporate Governance, president of the Stockholder Relations Society of New York, and member of the New York Stock Exchange Corporate Governance Commission. He is currently a member of the Corporate Laws Committee of the American Bar Association and the National Asian Pacific American Bar Association. Mr. Chia has received numerous awards and recognitions in corporate governance and has frequently appeared in the news media, including CNN, NPR Marketplace, the Wall Street Journal, the Financial Times, and The New Yorker.

Mr. Chia received an AB degree from Dartmouth College and a JD degree from the Georgetown University Law Center. Mr. Chia is based in Princeton, NJ, where he is a trustee of the Historical Society of Princeton and the McCarter Theatre Center.