Businesses say corporate governance can go too far

USA TODAY, June, 2004 by Edward Iwata

Shaken by shareholders' long-running revolt against overpaid CEOs, weak boards and poorly run businesses, the nation's corporations are starting to strike back.

Business officials are challenging the new post-Enron rules, calling them harsh and costly. They're blasting the two strongest forces in the governance movement: California Public Employees' Retirement System (Calpers), the public pension fund giant, and Institutional Shareholder Services (ISS), the No. 1 proxy-advisory firm. And in a huge regulatory fight, they're pressing the Securities and Exchange Commission to tone down a rule that would give shareholders more power to name board candidates.

Corporate-governance watchdogs -- the pension funds and proxy-advisory firms that monitor and invest trillions of...