ISS Lays Out 2005 Proxy Strategy

Institutional Shareholder Services (ISS) announced that it will continue to shine a spotlight on boards of directors and hold compensation committees responsible for linking executive pay to performance during the upcoming annual meeting season.The governance research firm elaborated that it will...

By Stephen Taub • Jan. 4, 2005

The Bribery Gap

Regulators have been intensifying their scrutiny of corporate bribery infractions lately. In the last half of 2004, for example:Bristol-Myers Squibb Co. revealed that the Securities and Exchange Commission has launched an investigation into some of the company’s German units for possible violatio...

By David Katz • Jan. 1, 2005

Looking to Land

The Boeing Co. has a lot riding on the 7E7 DreamLiner, the superefficient midsize passenger jet it plans to start producing in 2008. The company has already pumped billions of dollars into development of the aircraft, which it hopes will recapture some of the market share it has lost in recent ye...

By Randy Myers • Jan. 1, 2005

Tending to Your Corporate Reputation

Corporate reputations are rarely examined until after they’ve been damaged — and that’s a big mistake, says The Wall Street Journal’s Ron Alsop, author of The 18 Immutable Laws of Corporate Reputation. Companies should tend to their reputations as a matter of course, counsels Alsop; after all, it...

By Lisa Yoon • Dec. 28, 2004

Courts and Torts: Tax-Shelter Shocker

In October, the Maryland U.S. District Court handed corporate taxpayers a victory when Judge William Quarles ruled against the Internal Revenue Service in a case involving a Black & Decker Corp. (B&D) tax shelter. In essence, the court ruled that a tax shelter can be valid if it has “econ...

By Marie Leone • Dec. 21, 2004

SEC Rethinks Sarbox and Small Companies

The Securities and Exchange Commission is clearly sensitive to the plight of smaller companies that are struggling to comply with new corporate governance rules that apply to large and small companies alike.Earlier this month the SEC gave many of these smaller companies an extra 45 days to meet a...

By Stephen Taub • Dec. 20, 2004

A Half-Billion Ends Time Warner Probes

Time Warner agreed on Wednesday to pay more than $500 million to settle charges with the Securities and Exchange Commission and the Department of Justice.In its pact with the Justice Department, the media giant agreed to pay a fine of $210 million to settle charges that its America Online unit fr...

By Stephen Taub • Dec. 16, 2004

Die Hard (Drive)

In general, the development of faster computers just barely keeps pace with the need for faster computers. Back in 2000, for instance, a PC equipped with a Pentium III chip processing instructions at 500 megahertz per second could easily handle most computing tasks performed by a typical business...

By Esther Shein • Dec. 15, 2004

No Charges for Global Crossing’s Winnick

The Securities and Exchange Commission does not plan to bring civil securities charges against former Global Crossing Ltd. chairman Gary Winnick, according to his attorney, Gary Naftalis.The SEC had also been expected to fine Winnick $1 million for failing to properly disclose a series of transac...

By Stephen Taub • Dec. 14, 2004

Busting the Brokers

New York State Attorney General Eliot Spitzer has already changed the way insurance brokers and companies conduct business with each other. Chances are, his burgeoning investigation of the insurance industry will change the way you do business with them, too.Insurance has long been a chummy game....

By Randy Myers • Dec. 9, 2004

SEC May Delay 404 for Foreign Companies

Foreign companies that trade on U.S. exchanges may be the next group of companies to receive a short reprieve from meeting the requirements of Section 404 of the Sarbanes-Oxley Act.Securities and Exchange Commission Chief Accountant Donald Nicolaisen said in a speech this week that he is “sensiti...

By Stephen Taub • Dec. 9, 2004

D&O Premiums Fell 10 Percent in 2004

Premiums for directors’ and officers’ (D&O) liability insurance fell 10 percent in 2004, the first decline since 1999, according to Tillinghast’s 2004 Directors and Officers Liability Survey.At first glance, some observers may suggest that the declining premiums are a signal that insurers are...

By Stephen Taub • Dec. 9, 2004

WTC Verdict Won’t Hike Insurance Prices

Despite losing a lawsuit related to the World Trade Center collapse, officials at property/casualty companies say that other corporate customers will not be affected by their financial loss.Earlier this week, a jury decided that, for insurance purposes, the terrorist attacks on the World Trade Ce...

By Stephen Taub • Dec. 8, 2004

Make Some Noise

The so-called quiet period prior to the public sale of securities could get a little louder. The Securities and Exchange Commission is proposing to lift some restrictions on companies’ pre-IPO communications.Under a 1933 law, during the period surrounding an initial public offering the company ma...

By Kate O'Sullivan • Dec. 7, 2004

Kmart Vendors Hit with Fraud Charges

The Securities and Exchange Commission has sent a loud message that it will not tolerate individuals who help others commit fraud, even if the ones committing the fraud work for another company.As part of its probe of an accounting scandal at Kmart in early 2001, the SEC filed civil fraud charges...

By Stephen Taub • Dec. 6, 2004

Bribery Charges Stop More Deals

A growing number of companies are consulting with the Justice Department about possible bribery lapses before moving forward with cross-border acquisitions according to the Wall Street Journal.Besides reducing their financial risk, prospective acquirers are looking into whether target companies h...

By Stephen Taub • Dec. 6, 2004

Laying Down the Law

There’s a new seat at the management table these days, much to the relief of many CFOs. Largely in response to Sarbanes-Oxley, companies have begun to formalize the compliance role, creating a function dedicated to the watchdog tasks that have previously fallen to finance.In fact, according to Ma...

By Kate O'Sullivan • Dec. 6, 2004

SEC Suspends Trading in 26 Companies

The Securities and Exchange Commission suspended trading in the securities of 26 companies for at least 10 days, punishing the companies for not filing their financial results on time.Although the companies are very small and hardly household names, the move suggests that the commission considers...

By Stephen Taub • Dec. 3, 2004

Ex-Exec Settles Insider-Trading Charges

The Securities and Exchange Commission has settled illegal insider-trading charges with Evan S. Collins, a former finance executive of Network Associates Inc. Once a high-flying technology company, Network Associates is now known as McAfee Inc., after the antivirus software for which it is still ...

By Stephen Taub • Dec. 2, 2004

Judge Rules Against Scrushy over Sarbox

Score this round to the scribes of the Sarbanes-Oxley Act. In the first court challenge against the landmark corporate governance law, a federal judge ruled against former HealthSouth chief executive Richard Scrushy, who had asserted that several charges accusing him of falsely certifying the hea...

By Stephen Taub • Dec. 1, 2004

Off with CalPERS’ Head?

Sean Harrigan, president of the California Public Employees’ Retirement System (CalPERS), the nation’s largest pension fund, thinks he will be fired today as a result of his strong activist agenda, according to the Los Angeles Times.Harrigan, a regional executive for the United Food and Commercia...

By Stephen Taub • Dec. 1, 2004

Oracle Execs Cleared of Insider Trading

Oracle Corp. chairman and former chief financial officer Jeff Henley and chief executive Lawrence Ellison have been cleared of charges of illegally trading on insider information, according to the Associated Press.The two executives won a summary decision in a lawsuit stemming from trades execute...

By Stephen Taub • Dec. 1, 2004

Courts and Torts: Vetting Compensation

Even the The Incredibles would have a hard time rescuing the Walt Disney Co.’s compensation committee from their current predicament. In a trial eight years in the making, Disney shareholders are seeking $200 million in damages from board members and one-time president Michael Ovitz, alleging tha...

By Marie Leone • Nov. 30, 2004

The High Costs of Sarbox Compliance

Companies are being hit with a surge in costs stemming from their efforts to comply with the Sarbanes-Oxley Act, two surveys released last week found. But many of the companies aren’t sure what those efforts are achieving. For example, a survey of almost 270 board directors at U.S. companies rel...

By Stephen Taub • Nov. 29, 2004

Bond Insurer Is Latest Probe Target

The government’s probe of the insurance industry has extended to a major insurer of bonds.Last week, a day after completing the sale of $350 million of 30-year bonds, MBIA Inc. reported that it received identical subpoenas from the Securities and Exchange Commission and the New York Attorney Gene...

By Stephen Taub • Nov. 23, 2004