Event Summaries 2009 - 2010
June
Governance
Governance in 140 Characters
Social media is transforming corporate culture and the way
business gets done around the world.
Information Technology is now the lifeblood of every enterprise, driving
unprecedented improvements in efficiency, quality and productivity. This progress comes at a cost,
however. Thefts of proprietary data
can lead to millions of dollars in losses. Rumors can go viral in an instant, threatening corporate
reputations and the integrity of global brands. Corporate operations can be brought to a standstill by
random acts of nature. How can
directors best prepare themselves to address the impacts and risks of
information technology?
CLICK HERE to read the complete writeup.
CLICK HERE to view the PowerPoint Presentation
CLICK HERE to view the YouTube video shown at the June event!
May
GOVERNANCE
How to Prevent, Prepare For, and Deal with Lawsuits that Target Directors and Boards (Click Here to view the slide presentation)
Serve on a board for a meaningful time and chances are good that a director will be named as a defendant in a derivative lawsuit brought by an unhappy shareholder. With activist investing on the rise and the public growing increasingly distrustful of Corporate America and its leaders, why would any sane person choose to become a director? According to the three panelists at NACD New England’s May 18, 2010 Breakfast Event, service on a board can be as gratifying as ever – but only if directors themselves take precautions to ward off personal liability stemming from shareholder lawsuits. These precautions were explored in detail by the panelists, leading to a provocative question-and-answer session.
AprilGOVERNANCE
Non-Profit Boards: Managing Mission and Margin
“Survival of the fittest” is not
what first comes to mind when thoughts turn to managing a non-profit. But 1,200 to 1,500 registered
Massachusetts charities disappear each year, demonstrating the increasingly
Darwinian nature of the non-profit operating environment in one of the
wealthiest and talent-endowed states in the nation. In a period of scarce human and financial resources, how can
a non-profit board hone their organization’s survival instincts without losing
focus on its charitable purpose?
Sparked by the insights of three expert panelists, NACD New England’s April
13, 2010 Breakfast Event explored the opportunities and constraints faced by
today’s non-profit directors as they struggle to balance mission and margin. (Click here to view the slide presentation)
What is risk? One definition, attributed to Professor
Elroy Dimson of the London Business School, is that “risk means more things can
happen than will happen.” None of
us has the ability to sort out what actually will happen from what won’t, but directors
of public corporations still have to make good decisions. As directors, what is our
responsibility for managing risk?
How can risk best be managed in today’s dynamic business environment,
and how can our performance best be measured? NACD New England’s March 9, 2010 Breakfast Event was
highlighted by a spirited panel discussion on these and other key questions
related to board involvement in enterprise risk management. (Click here
to view the slide presentation.)
GOVERNANCE
Outside Directors Inside the Family Owned Business
Independent directors
venturing into closely held businesses enter a world with sometimes conflicting
agendas. Each Director’s fiduciary
duty is the same as with a public company; living up to that duty sometimes
runs afoul of internal politics.
How does a closely held family business with outside directors achieve
good governance in times of company transition? These issues were brought to life as five expert guests portrayed
a board meeting of the fictional family-owned American Electrical Products (“AEP”)
at NACD New England’s February 9, 2010 Breakfast Event.
Moderator Bill Poduska, an independent business consultant and member of multiple corporate boards, kicked off the panel discussion at NACD New England’s January 12, 2010 Breakfast Event by voicing a sentiment that seemed to resonate with everyone in attendance: evaluating director performance is a hard thing to do. “Most boards operate in a very collegial way, which makes it very difficult to do objective, intellectual and thoughtful evaluations of our peers,” he said. Sharing their experiences in overcoming these difficulties were three panelists with extensive backgrounds serving as directors and board advisors. CLICK HERE to view the slide presentation.
December
GOVERNANCE
The Government's New Role in the Corporate Boardroom
Ron Logue, Chairman and CEO of State Street Corporation, and James Segel, Special Counsel to House Financial Services Committee Chairman Barney Frank shared their insights on how the financial crisis has changed the federal government’s relationship with Corporate America. Ron Logue advised corporate directors to insist on more open and transparent board processes, to ask the toughest questions, and to take the time necessary to understand the most challenging issues in executing their governance responsibilities. CLICK HERE to view Mr. Logue's slide presentation.
November
GOVERNANCE
Breakfast With The Delaware Chancery
Breakfast event speaker Stephen P. Lamb stepped down as Vice Chancellor of the Delaware Chancery Court in June 2009. In his position as one of five jurists on the primary court for disputes involving Delaware corporations, Vice Chancellor Lamb has heard many of the most important recent cases regarding standards and practices in corporate governance. Before being appointed to the Delaware Chancery bench in 1997, he practiced for a number of years in the area of corporate and securities litigation in Delaware, at first with Skadden, Arps, Slate Meagher and Flom, and then as a principal in several smaller firms.
COMPENSATION
Updates in Executive Compensation
Risk
ERM - A Solution for Every Organization
Caturano and Company - Mar 02, 2010
Business risk management is something that most managers will say they do on a daily basis as part of their job. When probed to explain the process, however, the answers get less specific. While most other areas of business have seen the need to establish mature, sustainable and measurable processes, business risk management tends to still be done on an intuitive level, with no real data to support or validate its effectiveness. The advance of technology, the accelerating pace of business, globalization, regulation, increasing financial sophistication and the uncertainty of the economy all contribute to the growing number and complexity of risks. To say these are managed intuitively without structure, reporting and measurement can no longer be the best way to approach understanding and managing these risks.
SEC Modifies Approach to Advice on Risk
Hinckley, Allen & Snyder LLP - Feb 25, 2010
In October 2009, the Securities and Exchange Commission, Division of Corporation Finance (the “Staff”) issued Staff Legal Bulletin No. 14E (the “Bulletin”) regarding Rule 14a-8(i)(7) of the Securities Exchange Act of 1934. The Bulletin effectively reverses the Staff’s prior guidance, which allowed companies to exclude most shareholder proposals pertaining to internal assessments of risks, such as health, financial or environmental, on the basis that the proposals and supporting statements related only to the evaluation of such risks by the company, which the Staff previously viewed as relating to a company’s ordinary business operations.
Proxy Disclosure and Governance in an Increasingly Transparent World
Radford - an Aon Consulting Company - Feb 25, 2010
The ongoing march toward greater disclosure of, and investor engagement in, key pay and governance issues at US public companies is accelerating again in 2010. With the proposal and/or adoption of substantive legislative, regulatory and policy changes, Congress, the Securities Exchange Commission (SEC) and investor advisory groups have transformed the landscape on which company decisions about pay and governance are made.
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Compensation
Federal Reserve Joins Forces with the FDIC, OCC & OTS
Pearl Meyer & Partners - Jul 07, 2010
The Federal Reserve Board (FRB) was joined by the Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC) and Office of Thrift Supervision (OTS), (collectively the Agencies) on June 21 in issuing final guidance. The final guidance is generally consistent with the FRB’s proposal in October of 2009 governing incentive compensation for banking organizations. The Agencies’ stated purpose is to "ensure that incentive compensation arrangements at financial organizations take into account risk and are consistent with safe and sound practices" and to "assist banking organizations in designing and implementing incentive compensation arrangements and related policies and procedures that effectively consider potential risks and risk outcomes." The final guidance became effective upon publication in the Federal Register on June 25.
Repositioning Your Pay Programs for Recovery
Pearl Meyer & Partners - Jul 07, 2010
While the current economic climate is still unsettled, most signs point to a slow, steady rebound from the “Great Recession.” Companies are beginning to hire again and are resuming or increasing spending on merit increases, incentive/bonus payouts and equity awards after a prolonged and painful focus on managing payroll cost. That makes this an opportune time for employers to take stock of whether they are getting the best return on one of their most significant expenditures.
Executive Compensation Governance Reforms
Radford - an Aon Consulting Company - Jun 10, 2010
With the Senate’s May 20, 2010, passage of executive compensation and corporate governance reform legislation, two separate but similar bills are in front of Congress. Reconciliation of these bills is expected this summer, perhaps as early as July. Assuming passage of some form of combined act, companies will be facing further changes to their governance and pay processes and policies, in addition to the changes they have had to make since the SEC revisions of last December. This Alert compares the two pieces of legislation, and shares Radford’s observation on the impact the reforms could have on companies.
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Audit
Audit Committee Brief
Deloitte - Mar 10, 2010
Recent economic events have heavily influenced the SEC’s scrutiny of financial reporting. At the 2009 AICPA National Conference on Current SEC and PCAOB Developments, SEC Director of Enforcement Robert S. Khuzami said that during fraud investigations, his division is evaluating whether boards of directors and audit committees have properly discharged their duties. This evaluation includes determining whether red flags and other information that may have identified fraud were recklessly ignored.
Why Benchmark your Organization's Operations?
Caturano and Company - Mar 02, 2010
Companies are experiencing tighter budgets, longer sales cycles, and declining revenues. A focus on
reducing costs and improving efficiencies and effectiveness throughout the organization may provide a
growth path, if not survival. As a result, strategic initiatives such as benchmarking are on the rise,
providing business executives with valuable information that will help them remain at the forefront of their industry.
Benchmarking Survey
Caturano and Company - Mar 02, 2010
In August 2009, Caturano and Company conducted a high-level budgeting and planning benchmarking survey of more than 70 finance executives throughout New England. The purpose of this study was to examine current trends and best practices, as well as identify issues organizations contend with during their budgeting and planning process.
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Governance
Not-For-Profit Board Governance: Best Practices for CEO Review
McGladrey - Mar 29, 2010
One of the many benefits of serving on the board of directors (board) of a not-for-profit organization is the opportunity to have an impact on the mission and direction of the overall organization. The nature of the board role is often transitory with many members serving only one or two terms. While changes in board membership bring new perspectives and ideas to the organization, they can also create significant challenges for the CEO as he or she tries to determine what is expected under constantly changing board leadership.
Considerations for Navigating the SEC's New Proxy Disclosure Rules
Deloitte - Mar 10, 2010
The new SEC disclosure requirement regarding compensation-policy risk gives companies the opportunity to take a fresh look at their compensation programs, especially the incentive plans. While risk has always been an implicit consideration in the design of incentive compensation programs, the new requirement provides management and the compensation committee with an opportunity to have a constructive discussion regarding the level of risk taking that should be allowed in the company’s incentive plans. It also allows an excellent opportunity to improve the design of incentive plans and the required internal controls.
E-Proxy Update
Hinckley, Allen & Snyder LLP - Mar 10, 2010
On February 22, 2010, the Securities and Exchange Commission (“SEC”) amended its notice and access proxy rules, better known as the “e-proxy” rules, which were
initially enacted in 2007. The e-proxy rules require all issuers and other soliciting persons to post their proxy materials on an internet website, while allowing
issuers and soliciting persons the option of providing only a Notice of Internet Availability of Proxy Materials (“Notice”) to shareholders instead of the full set of printed proxy materials. The Notice, if
sent without the full set of proxy materials, would indicate how shareholders could access the proxy materials on the website. The goal of the e-proxy rules was to limit the cost and resource wastefulness
of traditional mailed proxy materials.
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Nominating
A Leadership Repository for Boards of Directors
Korn/Ferry International - Apr 28, 2010
As the scrutiny of corporate boards of large U.S. companies intensifies, it has become clear that something is missing from the governance picture: Hispanic directors. Hispanic Americans, who represent 14 percent of the United States population, occupy only 2.3 percent of the total board of director seats among Fortune 1000 companies. Only 19 percent of Fortune 1000 boards have a Hispanic director, a percentage that has barely budged in the past nine years, a period when the country’s Hispanic population – and the Hispanic consumer market (HCM) – increased dramatically.
A New Breed of Director Emerges as Public Policy Enters the Boardroom
Korn/Ferry International - Apr 28, 2010
The global credit crisis and the resulting rescue plans have raised the specter of ongoing government involvement in corporate life. Public companies are now and will continue to be under a microscope to an extent they have never experienced before. Are boards equipped with the expertise to navigate successfully through this impending era of heightened scrutiny?
Today's boards will be expected to watch over an organization's various risks, while at the same time help corporate management develop strategies to cope with the myriad of regulatory and policy issues that may affect their businesses. This whitepaper indicates that it is more important than ever for nominating committees to consider candidates with strong backgrounds in government policy making. Best- in-class nominating committees will find it useful to broaden their search to include individuals with executive-level experience working in government and for public policy-making entities.
Diversity Management
Egon Zehnder International - Sep 20, 2008
Today, diversity is a topic that is much broader than
efforts from yesteryear to be in compliance with
anti-discrimination laws and regulations. Workplace
diversity now focuses on creativity and creating
competitive advantage. More and more businesses
are making diversity an integral part of their strategy. When making executive appointments they
deliberately target specific populations that are
underrepresented on the management team.
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Strategy
Strategies for Going Public
Deloitte - Mar 10, 2010
You may be thinking of taking your company public and,
if so, you undoubtedly have many questions. Deloitte has been advising clients and assisting them in the process of going public for many years. Drawing on that experience, we have prepared this publication to assist you in answering those questions, to acquaint you with the “language” of going public, and to give you a working knowledge of some of the technicalities of the process.
Planning for Success: 10 Steps to Take Before the IPO Window Opens
Sharon Merrill Associates - Mar 19, 2009
Forecasts vary as to when the IPO market will come back, and even optimists say it could take a long time. To give you a sense of how slow the market has been, there were only 43 IPOs priced in 2008 versus 272 in the prior year. In your role as director of a pre-IPO company,it is your responsibility to ensure that management is using the current slowdown in the market to the company’s advantage. It is also an opportunity to update your own knowledge about recent developments in corporate disclosure and investor relations. Directors are increasingly becoming involved in these areas at the tactical, as well as strategic, levels.
How Effective Is Your Board?
Egon Zehnder International - Sep 20, 2008
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