EGC Corporate Governance Practices (May 2018)

EGC Corporate Governance Practices: A Survey and Related Resources PAGE 8 Board Size and Elections Size of Board The size of the boards of directors ranged from 2 to 15 members. The number of directors also grew from first filing to closing of the IPO – from an average of approximately 6.16 at first filing to approximately 6.62 at pricing to approximately 7.06 at the consummation of the IPO. The growth of the board of directors over time probably reflects the liability and perhaps even reputational concerns that independent directors may have about joining a board of directors before an IPO is consummated. Figure 11: N=848. Staggered Board Approximately 69.5% of the issuers (based on 839 companies for which data was available) had a staggered or classified board of directors. That is in sharp contrast to the trend in Fortune 500 ® companies to eliminate staggered boards of directors in response to shareholder activism and concerns that classified boards entrench management and are a potent anti-takeover device. 6.16 6.62 7.06 5.6 5.8 6 6.2 6.4 6.6 6.8 7 7.2 Average Number of Directors at First Filing Average Number of Directors at Pricing Average Number of Directors at Closing Growth in Average Number of Directors (From First Filing Through Closing) Average Number of Directors Triennial; 583 Annual; 256 Triennial Director Elections Versus Annual Director Elections (By Frequency) Triennial Annual