Pay Attention to Corporate Governance, MicroCap Investors

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Planet MicroCap Podcast   |   June 29, 2016

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For this episode of the PlanetMicroCap Podcast, I spoke with Adam J. Epstein, Founder of Third CreekAdvisors, LLC. Mr. Epstein is a former institutional investor, well-known speaker on corporate governance, and the author of the best-selling resource created specifically for small-cap corporate directors, titled, “The Perfect Corporate Board: A Handbook for Mastering the Unique Challenges of Small-Cap Companies.

As defined by Investopedia, Corporate Governance, “is the system of rules, practices and processes by which a company is directed and controlled. Corporate Governance essentially involves balancing the interests of the many stakeholders in a company – these include shareholders, management, customers, suppliers, financiers, government and the community. Since corporate governance also provides the framework for attaining a company’s objectives it encompasses practically every sphere of management from action plans and internal controls to performance measurement and corporate disclosure.” You can probably imagine the implications of having good or bad corporate governance in a MicroCap company.

The goal for this episode is to learn about and define corporate governance, understand why this is important when doing your due diligence and what we can do as investors to better know what we’re getting on the corporate governance front in MicroCap companies.

The Planet MicroCap Podcast is brought to you by SNN Incorporated, publishers of StockNewsNow.com, The Official MicroCap News Source, and the MicroCap Review Magazine, the leading magazine in the MicroCap market – check out the latest issue here: MicroCap Review Winter/Spring 2016

In this episode, Adam and I discuss the following topics:

– Mr. Epstein’s background

– Issues Third Creek Advisors helps pre-IPO and MicroCap companies with

– What Corporate Governance means and why is it important to keep in mind when looking at MicroCap companies

– As a MicroCap investor, what are some qualities that we should look for in a MicroCap board of directors as a whole and individually

– Typical reasons to change a board member

– What do you do when the board becomes completely uncooperative?

– Going back to one of your previous answers, you referenced shareholder activists. Is that a realistic concern for most micro-caps?

– Where most microcap boardrooms underperform

– Common governance shortcomings

– What can we do as investors to better know what we’re getting on the corporate governance front with micro-caps

– Do you have any stories, without using the names of the companies, that taught him the importance putting together a solid board

– Advice for new MicroCap investors when doing their due diligence on the board of directors of these companies

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ADAM J. EPSTEIN

A globally recognized small-cap expert, Mr. Epstein has advised, governed, and invested in hundreds of small-cap companies. His capital markets and corporate governance acumen are products of a singular perspective – a former corporate attorney, operating executive, institutional investor, and, now, board advisor. As Bloomberg Businessweek commented regarding Mr. Epstein’s category-defining corporate governance book, “attention, directors of small-cap companies. Help is on the way.” 

Thousands of global execs read Adam’s bi-weekly leadership commentary

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