J. W. Verret

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J. W. Verret

  • Member, Financial Markets Working Group
  • Senior Scholar
  • Assistant Professor, George Mason University School of Law

J.W. Verret is a senior scholar at the Mercatus Center at George Mason University. As a member of the Mercatus Center's Financial Markets Working Group, he regularly briefs Congressional staff, members of Congress, SEC Commissioners, and other financial regulatory agencies on financial regulation topics. Verret is an assistant professor of law at George Mason University School of Law. His primary research interests are corporate governance, securities regulation, and executive compensation.

He received his JD and MA in public policy in 2006 from Harvard Law School and the Harvard Kennedy School of Government, respectively. While in law school, Verret received an Olin Fellowship in Law and Economics at the Harvard Program on Corporate Governance under the guidance of Professor Lucian Bebchuk.

Verret served as a law clerk for Vice-Chancellor John W. Noble of the Delaware Court of Chancery. Prior to joining the faculty at Mason Law, Verret was an associate in the SEC Enforcement Defense Practice Group at Skadden, Arps in Washington, DC. He has written extensively on corporate law topics, including a recent paper, Delaware's Guidance, coauthored with Chief Justice Myron T. Steele of the Delaware Supreme Court. His academic work has been featured in the Yale Journal on Regulation, The Business Lawyer, the Delaware Journal of Corporate Law, the University of Pennsylvania Journal of Business Law, and the Virginia Law and Business Review. Verret was selected by the Northwestern Law School Searle Center on Law, Regulation, and Economic Growth for a 2009-2010 Searle-Kaufmann Research Fellowship.

Verret also directs the Corporate Federalism Initiative, where he obtains research grants for a network of students and faculty scholars who study the division between states and the federal government as sources of corporate law. Verret has been invited to testify before various Congressional committees during the financial crisis of 2009 regarding all of the central provisions of the Obama administration's 2009 financial regulatory reform proposals.

Verret has been quoted in various media on financial regulation and corporate law topics, including the Wall Street Journal, CNN Money, the CNN Political Ticker, CNBC, ABC News, Investor's Business Daily, ESPN.com, The American Banker, The American Lawyer, The Huffington Post, CBS.com, and the Associated Press. Verret's op-eds have been featured in Forbes, the Chicago Tribune, and the Orange County Register.

Verret is also a regular guest contributor to some of the most noted corporate law and financial regulation law blogs: the Harvard Law School Corporate Governance and Financial Regulation Forum, DealLawyers.com, and The Conglomerate.

Published Research

How to Fix Our Broken Proxy Advisory System

James K. Glassman, J. W. Verret | Apr 16, 2013
A rule enacted by the Securities and Exchange Commission in 2003 required institutions to adopt and disclose policies for proxy voting that were intended to minimize conflicts between the institutions’ interests and those of their shareholders. An SEC staff interpretation of that rule led to a result almost the opposite of the ruling’s intent. Institutions could easily protect themselves from legal liability by shifting responsibility to proxy advisory firms, which acquired increasing power over corporate governance, to the detriment of shareholders.

Does Shareholder Proxy Access Damage Share Value in Small Publicly Traded Companies?

Thomas Stratmann, J. W. Verret | Jun 01, 2012
The field of corporate governance has long considered the costs of the separation of ownership from control in publicly traded corporations and the regulatory and market structures designed to limit those costs.

Defending Against Shareholder Proxy Access

J. W. Verret | Aug 08, 2010
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 has ensured that a shareholder’s ability to place nominees to the board onto the corporate ballot, an objective long advocated by the institutional investor community, will soon be implemented by the Securities and Exchange Commission. Advocates of proxy access urge that it will help hold Boards of Directors accountable to their owners. Critics argue that it will give conflicted shareholders, like unions and state pensions, power they will use to facilitate their political objectives at the expense of ordinary shareholders. The shareholder primacy and director primacy theories of corporate law have framed an extensive debate in the literature. Regardless of which theory holds force, we can expect Boards to implement defensive strategies in the wake of proxy access to limit shareholder power, in the same way that Boards implemented defensive tactics in response to the hostile takeovers of the mid-1980s. Delaware’s review of Board proxy access defenses will shape its role in the foreseeable future in much the same way review of Board takeover defenses shaped its role over the last 20 years.

Delaware's Guidance

J. W. Verret | May 07, 2008
This Article examines some of the extrajudicial activities in which members of the Delaware judiciary engage to minimize the systemic indeterminacy resulting from the resolution of economic disputes by a court of equity. These activities come in three unique forms: 1) the frequent speeches and articles offered by the judges about the direction and patterns they perceive in case law from their unique vantage point at the center of the maelstrom; 2) the analysis in the judges' opinions that, though technically dicta, provides useful insight into how open questions not part of the ruling might be expected to play out in the future; and 3) the roles the judges often undertake as formal policy makers, as members of committees of the American Bar Association (ABA) and other model rule making bodies. The result is an appreciation for how Delaware's judiciary offers unique insight, beyond the four corners of issued holdings, to the counselors of the Boards of Directors which govern the collective enterprise of our market system.

Working Papers

The Law and Economics of Shareholder Voting Reform and the Costs of Proxy Access

Thomas Stratmann, J. W. Verret | Jan 17, 2012
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 gave the U.S. Securities and Exchange Commission (SEC) the authority to adopt a proxy access rule. Though the legislation urged an exemption for companies with less than $75 million in market capitalization, the SEC unexpectedly failed to provide a permanent exemption from the rule for those companies. This paper finds that, for the roughly 900 publicly traded companies studied with under $75 million in market capitalization, the proxy access rule caused on the order of $335 million in shareholder losses.

Executive Compensation: New Federal Initiatives Project

J. W. Verret | Sep 22, 2009
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Treasury Inc.:

J. W. Verret | Aug 24, 2009
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Policy Briefs

A Self-Regulatory Proposal for the Hedge Fund Industry

J. W. Verret, Katelyn Christ | Jan 13, 2010
As part of a broad legislative effort to regulate hedge funds, Congress has introduced a bill that would require hedge funds to register with the SEC and comply with new record keeping and disclosure…

Corporate Voting

J. W. Verret, Stefanie Haeffele-Balch | Nov 2009
The recent financial crisis has prompted policy makers to reassess the guidelines and structures of corporate governance and shareholder rights. The authors discuss how new shareholder powers may…

Implications and Analysis of Government Shareholding in the Financial Sector

J. W. Verret | Apr 2009
The federal government's new position as the dominant shareholder in the financial services sector requires careful consideration of its shareholder rights vis-à-vis its position as a unique entity…

Testimony & Comments

Measuring the Costs and Benefits of New Rules

J. W. Verret | Apr 17, 2012
After a careful review of the legislative requirements that the SEC consider investor protection, efficiency, competition and capital formation in adopting new rules, I would like to simply offer a list of six items that would demonstrate a sincere commitment by the SEC to fulfill its statutory mission. The first five I will list are in fact required by law if one carefully reads the legislative and judicial history of the SEC’s mandate to consider the economic impact of new rules.

Fixing the Watchdog: Legislative Proposals to Improve And Enhance the Securities and Exchange Commission

J. W. Verret | Sep 15, 2011
J.W. Verret testified before the House Committee on Financial Services about proposals to improve the Securities and Exchange Commission (SEC).

Wall Street and Fiduciary Duties: Can Jail Time Serve as an Adequate Deterrent for Willful Violations?

J. W. Verret | May 04, 2010
Professor J.W. Verret discusses the question of fiduciary duties for Wall Street brokers and the possible implications new regulations could have on markets.

Hearing on Short-termism in Financial Markets

J. W. Verret | Apr 29, 2010
In this testimony before the Senate Committee on Banking, Housing, and Urban Affairs - Subcommittee on Economic Policy, Professor J.W. Verret discusses the causes of short-termism in today's capital…
More Testimony & Comments

Research Summaries & Toolkits

The Unintended Consequences of Executive Compensation Regulation

J. W. Verret | Aug 03, 2009
Statutory and regulatory mandates to change or limit executive compensation structures threatens to worsen the current financial crisis. Historically, compensation regulation has resulted in…

Media Clippings

GM ‘Turnaround’ Reports Rely on ‘Overbuilding,’Jam-Packed Dealer Lots

J. W. Verret | Jul 19, 2012
Outlet: The Daily Caller

About the Dodd-Frank Act, George Washington Would Be Turning Over in His Grave

J. W. Verret | Jul 02, 2012
Outlet: Forbes

Verret: Obama keeps poor in their place

J. W. Verret | Apr 27, 2012
Outlet: The Washington Times

No, dude, we don’t need more Solyndras

J. W. Verret | Dec 09, 2011
Outlet: Washington Times
More Media Clippings

Expert Commentary

Fixing the Broken Proxy System

Bloomberg
By J. W. Verret, James K. Glassman |
Apr 23, 2013

Proxy season has begun, and it’s expected to be a hot one. More than half of publicly listed U.S. companies will hold annual meetings between now and the end of June. There will be votes on more than 200,000 questions, ranging from approving auditors to disclosing political contributions.

New Report Finds Fundamental Flaws in America’s Proxy Advisory System; Offers Three Policy Recommendations to Fix Broken System

By James K. Glassman, J. W. Verret |
Apr 17, 2013

The Securities and Exchange Commission’s proxy voting rules were meant to ensure well-informed proxy votes that reflect the interests of shareholders. However, the rules have instead given rise to two influential proxy advisory firms that have an inordinate amount of influence on corporate governance, according to a new report released by the Mercatus Center at George Mason University.

The SEC Ponders Circumventing Citizens United

The Wall Street Journal
By J. W. Verret |
Jan 08, 2013

In its January 2010 Citizens United v. FEC decision, the U.S. Supreme Court recognized the First Amendment rights of corporations and unions to spend money in support of causes important to their members. In response, Democrats in Congress introduced a bill requiring publicly traded corporations to disclose these expenditures. The so-called Disclose Act would have expanded the Securities and Exchange Commission's authority to require disclosure of financially relevant information to include small political expenditures.

Dodd-Frank Turns Two

By Hester Peirce, J. W. Verret, Anthony B. Sanders, Todd Zywicki, Arnold Kling |
Jul 20, 2012

Two years later, after being praised by politicians as the financial system’s magic bullet, Dodd-Frank is, in effect, riddled with half-baked solutions, corrupted by special interests, and poised to create, not prevent, the next financial crisis.
More Expert Commentary