Corporate governance - Vigil

Private companies granting share-based compensation to their employees often will rely on Rule 701 under the Securities Act of 1933 (the “Securities Act”), particularly if the employees being granted options or restricted stock units (or other forms of compensation that otherwise would implicate the registration requirements of Section 5 of the Securities Act) do not qualify as “accredited investors.” Rule 701(e) requires an issuer to deliver, a reasonable period prior to the date of sale, financial statements, among other things, to all employees in the United States to whom the issuer sells securities in reliance on Rule 701 if the issuer sells securities in excess of $5 million in a 12-month period under Rule 701.

Blockchain is the technology that underpins digital currencies such as Bitcoin – but it has far wider applications and is being used in a growing number of areas. The blockchain has the potential drastically to alter the global financial system.

In this paper, we show how our society can use corporate governance shifts to address, if not entirely resolve, a number of currently pressing social and economic problems. These problems include: rising income inequality; demographic disparities in wealth and equity ownership; increasing poverty and income insecurity; a need for greater innovation and investment in solving problems like disease and climate change; the “externalization” of many costs of corporate activity onto third parties such as customers, employees, creditors, and the broader society; the corrosive influence of corporate money in politics; and discontent and loss of trust in the capitalist system among a large and growing segment of the population.

The House Ways and Means Committee on November 2, 2017, released the proposed Tax Cuts and Jobs Act, which may have significant impact on the taxation of equity and performance-based compensation for both private and public companies. The 400-plus-page draft bill was revised on November 3, 2017, and remains subject to further revision by the House, Senate and members of the White House Administration, including the Treasury Department in the coming days. If enacted in its current form, the bill would become effective January 1, 2018.

The “supercharged IPO,” a new and increasingly popular financial transaction, has fundamentally changed the nature of IPOs for many companies. Traditionally, an

New guidance released on November 1st by the staff of the U.S. Securities and Exchange Commission (SEC) Division of Corporation Finance has the potential to reshape the playing field of shareholder proposals, with new opportunities and obligations for issuers and company boards.

In March 2009, H. David Kotz, then Inspector General (IG) of the SEC, released a report outlining the questionable trading activity of two lawyers employed by the SEC’s enforcement division. IG Kotz admitted in subsequent testimony before Congress that the SEC lacked a compliance system capable of tracking and auditing employees’ trades [1]. This report and testimony, as well as the accompanying public outrage, spurred Mary Shapiro, then SEC Chairman, to impose new, stricter internal rules, beginning in August of 2010, whereby SEC employees must (i) refrain from buying or selling stocks of firms under SEC investigation; (ii) have their transactions pre-approved, and; (iii) order their brokers to provide transaction-level information to the SEC. [2]

Last year, a record number of public companies held virtual-only shareholder meetings, which are now permitted in Delaware, Virginia, and numerous other states. Despite some shareholder opposition, we believe this trend is likely to continue. This post provides a comprehensive overview of practical issues that a company must consider in deciding whether to switch to, and then how to implement, virtual-only shareholder meetings.

Industry News 2017-11-14T13:30:00Z Survey finds support for requiring corporate boards to adopt quotas on the representation of women Amid slow progress on

On Thursday, November 16th, ISS released its 2018 Benchmark Policy changes that will be effective for annual meetings that occur on or after February 1st, 2018.

Donnelley Financial Solutions is the country’s premier financial communications firm. Each year we assist more than one-third of U.S. companies with their proxy statements. This assistance includes printing, SEC filing, distribution, web-hosting and furnishing advice on content, strategy and design.*

The IoD Good Governance Index (GGI) is an innovative way for external stakeholders to
assess the overall standard of corporate governance at the largest UK-listed companies.
Launched in 2015, it is now in its third year.

In Waggoner v. Barclays PLC, No. 16-1912 (2d Cir. Nov. 6, 2017), the Second Circuit held that shareholder plaintiffs seeking class certification under the presumption of reliance conferred by the fraud-on-the-market doctrine need not offer direct evidence of market efficiency so long as other indicia of market efficiency are established. This ruling will make it more difficult for public companies defending securities fraud class actions to oppose class certification unless certain indirect evidence of inefficiency is also present.

Proxy advisory firm Institutional Shareholder Services (ISS) has announced its final U.S. voting policies for the 2018 proxy season, which will apply to stockholder meetings held on or after February 1, 2018. ISS had previously released draft proposals on several (though not all) of the topics in October. Changes to non-U.S. voting policies were also announced.

Corporate creditors play an important role in firm governance. For example, Lee Enterprises, Inc. reported in their third quarter 2008 financial statement that “the Company’s strategies are to increase its share of local advertising through increased sales activities in its existing markets and, over time, to increase its print and online audiences through internal expansion … [and] acquisitions.”

New York City is the latest legal jurisdiction to prohibit companies from inquiring about a prospective employee’s compensation history during the recruiting process, joining 2 other cities (San Francisco and Philadelphia), 4 states (California, Delaware, Massachusetts, and Oregon), and 1 other jurisdiction (the Commonwealth of Puerto Rico) in implementing such legislation. These laws have been enacted by their respective jurisdictions to address compensation discrimination based on gender, race, and ethnicity.