Renaissance Capital's Investing Tools
Corporate Governance Checklist
IPOs need even more scrutiny about corporate governance than established public companies. These private companies are often reluctant to put aside the privileges of being private in order to become a public firm. In the long run, the best IPOs have a shareholder-friendly corporate governance structure. That is why corporate governance is one of the four factors that go into Renaissance Capital's rating system. Our analysts use this checklist to evaluate the corporate governance structure of every IPO.

1 Do proceeds from the IPO go to the company?

2 Is there an absence of management perks and fees?

3 Is management experienced and able to work together?

4 Does management have a record of good judgement?

5 Can the company succeed independently of controlling shareholders?

6 Does management own enough shares?

7 Is the management compensation package reasonable and motivating?

8 Is the Board of Directors independent?

9 Does management devote full-time to the company?

10 Is the management of a family business professional?