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The article copied below appeared in Global Proxy Watch, a private weekly newsletter covering international corporate governance developments for clients of Davis Global Advisors, Inc.


For previous developments concerning the meeting reported in the article, see



Right Option  Can the market untangle the mess surrounding stock options at US companies—or is this one for the regulators? On Monday, as some 150 companies faced probes into options backdating, the market said it wants a crack at the job. New York-based governance advocate Gary Lutin took the chair of a new transatlantic Options Policies Forum sponsored in part by Hermes Equity Ownership Services (EOS). The purpose: forging dialogue with select corporates to issue common principles on stock option pricing. Sure, one might be ‘no backdating allowed.’ But sponsors want a broader framework on option pricing. And they want it quick. An advisory panel will issue recommendations by March—in time for the 2007 US AGM season. EOS hopes the Forum will pioneer UK-style constructive engagement among corporates and shareowners as an alternative to confrontation. Contact




GLOBAL PROXY WATCH © 2006 Davis Global Advisors Inc All rights reserved ISSN 1534-8822 Nov. 3 2006

Stephen Davis, editor. T +1 203 245 2288 +44 [0]20 8133 6828 Skype: davisglobal F +1 203 245 2278 E





This Forum program is open, free of charge, to all shareholders of the invited corporate participants, and to any fiduciaries or professionals concerned with the investment decisions of those shareholders, according to the posted Conditions of Participation.  The Forum's purpose is to provide shareholders with access to information and a free exchange of views on issues relating to their investment interests described in the Forum Summary As stated in the Conditions, all Forum participants are expected to make independent use of information obtained through the Forum, subject to the privacy rights of other participants.  It is a Forum rule that participants will not be identified or quoted without their explicit permission.

This Forum program has been organized with the support of Hermes Equity Ownership Services, Ltd.  It is the first in an expected series that will be managed by a not-for-profit “Institute” to be established for the purpose of continuing the Forum programs conducted by Gary Lutin.

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