On March 20, 2020, news outlets reported that four U.S. Senators sold millions of dollars in stock following classified briefings to the Senate on the threat of a COVID-19 outbreak.  Three days later, the Co-Directors of the Securities and Exchange Commission’s (“SEC”) Division of Enforcement, Stephanie Avakian and Steven Peikin, issued a statement reminding market participants of their obligations with respect to material non-public information (“MNPI”) and of the SEC’s commitment to protecting investors from fraud and ensuring market integrity.[1]
Continue Reading Insider Trading Risk During the COVID-19 Outbreak

Glass Lewis recently announced an update of its guidelines, which temporarily relaxes its standard policy against virtual meetings in light of COVID-19. The update provides that “[f]or companies opting to hold a virtual-only shareholder meeting during the 2020 proxy season (March 1, 2020 through June 30, 2020), [Glass Lewis] will generally refrain from recommending to vote against members of the governance committee on this basis, provided that the company discloses, at a minimum, its rationale for doing so, including citing COVID-19.”[1]  This formal update of Glass-Lewis’s guidelines comes on the heels of statements by both Glass-Lewis and ISS indicating openness to relax their positions on virtual meetings, which we discussed here.
Continue Reading Glass Lewis Revised Guideline Regarding Virtual Meetings for 2020 Proxy Season

This is an updated version of our prior post to address a new guideline issued by Glass Lewis.

With rising concerns around the spread of COVID-19 (“coronavirus”) in the United States and globally, in order to mitigate health risks, many public companies may consider adding a virtual component to the format of their annual shareholder meetings.  In the United States, state law generally governs the availability of a virtual meeting format.  At the federal level, the SEC regulates the filing and mailing of proxy solicitation materials.  While we have not seen direct guidance from state legislatures on virtual or hybrid meetings in the context of the coronavirus pandemic, on March 13, 2020, the SEC released guidance (“SEC Coronavirus Guidance”) addressing annual shareholder meetings[1] in light of recommendations by the Centers for Disease Control and Prevention (“CDC”) and other public health officials to cancel, or explicitly state policies that prohibit, large, in-person gatherings[2] in an effort to prevent the spread of coronavirus.[3]  Set forth below are various considerations that a company should take into account when determining whether to move from an in-person to a virtual or hybrid[4] annual meeting
Continue Reading UPDATE: Coronavirus & Virtual Annual Meetings

In light of the growing concern about COVID-19 (“coronavirus”) in the United States and globally, the U.S. Centers for Disease Control and Prevention (“CDC”) and other public health officials have recommended cancelling large, in-person gatherings for the next several weeks.[1] As a result, some companies may be considering, or may in the coming weeks need to consider, postponing the date of their shareholder meeting.  While moving to a virtual or hybrid meeting, as discussed in our blog post, “Coronavirus & Virtual Annual Meetings,” may be a good solution for certain companies, other companies may determine (or due to a lack of vendor capacity may be forced to determine) that the better course of action for them is to postpone or adjourn their annual meetings.
Continue Reading Coronavirus & Postponing/Adjourning Annual Meetings

Last week the Securities and Exchange Commission Chair Clayton and Commissioners Lee and Peirce each issued statements on climate-related disclosures in SEC filings. The statements were prompted by the concurrent SEC’s proposal to amend the MD&A rules and evidence some debate within the SEC on this topic, which has attracted considerable recent attention among investors,

Yesterday the Securities and Exchange Commission took two significant actions relating to the MD&A disclosures in annual and quarterly reports of public companies.

First, it proposed amendments to MD&A requirements that would, if adopted, make significant and long-overdue improvements to a central disclosure requirement of the U.S. securities laws. Second, it issued guidance on the

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2020”.

Corporate Purpose

On August 19, 2019, the Business Roundtable released its latest Statement on the Purpose of a Corporation, emphasizing commitment to all stakeholders.[1] The Statement received a lot of attention

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2020”.

SEC Disclosure and Reporting Developments

Recently, the US Securities and Exchange Commission continued to move forward with a number of disclosure effectiveness and simplification initiatives, the details of which are available in

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2020”.

Last year at this time, companies and boards were wrestling with the impact of the new revenue recognition standard and the new lease accounting standard. The next big innovation in accounting standards

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2020”.

Investors and other stakeholders continue to focus on environmental, social and governance (ESG) issues at public companies, both as a driver of financial performance and as a factor of social importance.

The