Category: Corporate Governance
Ninth Circuit addresses SOX 304 clawback requirements and liability for Rule 13a-14 false certifications
by Cydney Posner A new case from the 9th Circuit, SEC v. Jensen, is the first circuit court case to confirm the SEC’s position that the “clawback” provisions of SOX 304 provide for a disgorgement remedy against CEOs and CFOs when the issuer has restated its financial statements as a […]
The unintended consequences of say on pay
by Cydney Posner This post from the Columbia Law School CLS Blue Sky blog, “Should Say-on-Pay Votes Be Binding?,” by two executives from the Institute for Governance of Private and Public Organizations in Canada, in exploring the issue raised in the post’s title, looks at the question of the effectiveness and […]
Study finds disclosure of “critical audit matters” may reduce legal exposure for auditors
by Cydney Posner When the PCAOB originally floated the idea of an expanded audit report in 2011, the proposal fueled quite a controversy. Supporters of the concept contended that the current form of the auditor’s report was just boilerplate that “tells investors little of substance about a company’s true condition,” while […]
BDO analysis of tech industry risk factors shows increased impact of cybersecurity and M&A concerns
by Cydney Posner An analysis by audit firm BDO of the incidence of disclosure of various risk factors among tech companies over five years reflects increased emphasis on security breaches, the impact of M&A (including goodwill impairment) and accounting and internal control compliance as key issues affecting the industry. Regulatory […]
It’s back to square one: pay CEOs with short-term incentives?
by Cydney Posner How to structure executive pay to drive performance over the long term—while avoiding pay levels that would be considered excessive—is a conundrum for compensation committees, consultants, proxy advisory firms and others involved in setting or analyzing executive compensation. And the analysis has only become more complex since […]
SEC proposes to require exhibit index hyperlinks
by Cydney Posner The SEC has just issued a proposal to amend the rules to require that exhibits to registration statements and reports contain hyperlinks to the exhibits in the exhibit index and that these filings all be made in HTML format. The proposal, which was made in “furtherance of […]
Employees on boards — headed across the Atlantic?
by Cydney Posner As discussed in this PubCo post, in a speech delivered in July, the about-to-be new U.K. Prime Minister and leader of the Conservative Party, Theresa May, advocated strenuously for a number of corporate governance reforms, an approach she herself characterized as “something radical.” Among the reforms that May surprisingly […]
SEC requests comment on non-financial/non-business items in Reg S-K
by Cydney Posner The SEC has posted a request for comment on some of the Reg S-K disclosure requirements that were not specifically covered in the Reg S-K Concept Release, issued earlier this year (see this PubCo post), which assessed the Reg S-K business and financial disclosure requirements. This release […]
Individual shareholder proposals—why do they do it?
by Cydney Posner This recent paper from the Rock Center for Corporate Governance at Stanford University, “Gadflies at the Gate: Why Do Individual Investors Sponsor Shareholder Resolutions?” attempts to answer a question I’ve been wondering about for quite a while: why do individual investors invest their time and energy pursuing […]
Some successful approaches to increasing board gender diversity
by Cydney Posner A lot has been written about the benefits of gender diversity on boards. As discussed in Bloomberg, while “[e]quality is a worthy goal on its own terms, of course….for the corporate world, the better rationale for gender diversity is financial…. Companies with at least one female director had […]
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