Boards may be ready and willing to rise to
Everyone thinks they understand insider
the challenge. Unfortunately, an impediment
trading rules, and as a result, can sometimes
to success is the lack of consistent, industry-
become a little casual about them. The SEC
wide agreements on what these terms mean
and the US Department of Justice (DOJ)
and how to measure them.
continue to bring insider trading cases,
That does not, however, mean that boards are off the hook. A number of third parties have jumped in to offer definitions and measurement standards. Boards in 2020 will need to refine (and for some, select for the first time) the working definitions and measurable goals they have selected for their companies—and to then be clear in their disclosures about these choices.
showing that it doesn't pay to joke around about these matters.
2.9 Ways to Reduce Your D&O Insurance Premiums The difficult D&O insurance litigation environment is one of many reasons we are seeing the D&O insurance market reset pricing. Companies are using this as
In addition, boards will want to stay in front
an opportunity to re-examine their D&O
of political issues that may impact their
insurance purchase decisions.
companies, whether due to a consumer campaign or as a result of employee activism.
In 2020, we expect companies to continue to examine the data driving their purchase
2.8 Government Investigations and Prosecutions
decisions. In some cases, companies will elect
Like the ocean, it's never a good idea to turn
D&O insurance programs.
to retain their traditional programs. In other cases, we will see a radical restructuring of
your back on the government. Directors and officers must always be vigilant when it comes to legal compliance. For example, the Foreign Corrupt Practices Act (FCPA) is a perennial favorite of regulators, and the Securities and Exchange Commission's whistleblower program shows no sign of easing up.
LOOKING AHEAD 2020 | WOODRUFF-SAWYER & CO.
Return to Table of Contents >>
17