Current Applicable Governance Practices
One of the most important functions of a board of directors is to oversee management in the drive to achieve long-term shareholder returns. A financially strong and long-term oriented controlling shareholder is aligned with the interests of other shareholders in this respect and can have a significant positive impact on a corporation’s long-term returns, benefiting all shareholders and the corporation as a whole. The benefits can include the ability to encourage and support management in the pursuit of long-term strategies and the provision of directors who are experienced and knowledgeable about the business of the corporation. In the case of our corporate group, many of these attributes are provided through a governance model which provides for the inclusion of officers and directors of the Corporation or REDD Management, Strategy, and Financial (RMSF) Corporation on the boards of our subsidiaries.
These Directors have a relationship with the subsidiaries as directors and shareholders, and the full-time job of officers of the Corporation is to focus on and become knowledgeable about the affairs of our subsidiaries. Serving as a director of a subsidiary is an extension of the role as an officer of the parent shareholder and assists such person in discharging their corporate law duties. Meanwhile, the interests of the parent are well-served by the experience of and expertise in the affairs of group companies brought to the parent by those officers who also serve on the boards of its subsidiaries. The presence of our officers and Directors on our subsidiaries’ boards assists our board in the proper stewardship of our holdings, enriches the discussion, and enhances the quality of governance, at both our Board and our subsidiaries’ boards.