Sky Blog
The United States Department of Justice’s Fraud Section recently released a guidance document entitled Evaluation of Corporate Compliance Programs (“Evaluation Guidance”),[1] which sets forth a list of common questions that the Fraud Section may ask in evaluating corporate compliance …
When high-profile cases of fraud make the news, we often focus our attention on the CEO or other C-suite executives, asking what signs were missed and how we might better anticipate who might commit fraud. Academics have researched the characteristics …
After Delaware prohibited fee-shifting provisions in corporate bylaws,[1] scholars considered alternate means by which corporations might use private ordering to limit the ability of stockholder plaintiffs to bring lawsuits challenging corporate actions. For instance, Professor Sean Griffith suggested that …
In early February, Justice Randy Holland, the longest-tenured member of the Delaware Supreme Court, announced his plans to retire at the end of March 2017. At the time of his appointment in 1986 by Governor Michael N. Castle, Justice Holland …
Many financial institutions1 have implemented the three Lines of Defense (LoD) model to help define their risk management frameworks and bolster supervisors’ (e.g., desk heads and senior traders) abilities to monitor risk.2 However, as frameworks for managing financial …
Over the past few years, interest in corporate social responsibility (“CSR”)[1] has increased significantly. The spotlight on CSR has led companies to expand and strengthen their CSR efforts. Many companies in turn have published sustainability reports, posted materials on …
The New York Stock Exchange requires that the board of each publicly traded corporation “conduct a self-evaluation at least annually to determine whether it and its committees are functioning effectively.” The purpose of this exercise is to ensure that boards …
Developments in private and public markets are changing the role equity plays in the United States, i.e., what “stock” means as a matter not only of investment and corporate governance, but also of political economy. For several generations, a broad …
In the past 20 years, many corporate law scholars have come to the view that governance arrangements protecting incumbents from removal are what really matter for firm value, arguing that such arrangements help entrench managers and harm shareholders. A major …
Professor Lynn LoPucki of UCLA School of Law speaks with Reynolds Holding about the competition among states for corporate charters. Many people assume that the game is over and Delaware — the corporate home of more than half of U.S. …
It has long been a policy of corporate law1 that the informed business decisions of independent and disinterested directors are protected by the presumption of the business judgment rule.2 Courts are reluctant to second-guess decisions that are made …
President Trump has repeatedly used his Twitter account to single out companies for criticism of their business practices, raising the question for a broad range of public companies of how to prepare for and potentially respond to such criticism. Of …
Although U.S. corporate law has traditionally been left to the states, it is widely understood that a host of federal actors can and do affect the broader rules of corporate governance in fundamental ways. How might the corporate governance landscape …
Earnings management is the use of managerial discretion to apply accounting standards or construct business transactions in a way that alters reports on the financial health of an organisation [1]. Earnings management can include both legitimate and illegitimate methods “to …
Hedge funds have boosted shareholder activism worldwide. In my recent article, I discuss the policy response to hedge fund activism. I argue that the short-termism debate cannot shed light on the desirability of such activism. Rather, hedge fund activism should …
President Trump made many statements during the campaign regarding actions he plans to take to reverse Obama administration sanctions policies.[1] These included revisiting the agreement to ease sanctions on Iran, rolling back the sanctions program against Russia, and reversing …
Much of the public has long believed that executives are overcompensated, a sentiment that has occasionally crept into legislation. In one case, Congress voted to impose punitive excise taxes on managers who received excessive golden parachute payments. Unlike most taxes …
2016 was, by any measure, an extraordinary year for the enforcement of the Foreign Corrupt Practices Act. The Department of Justice and the Securities and Exchange Commission assessed a record-shattering total of nearly $2.5 billion in penalties. But despite those …
President Donald Trump’s campaign proposals included changes to tax rates and a promise to repeal the Dodd-Frank Act. If enacted, these proposals could have a significant impact on the way businesses handle executive compensation, permitting companies greater flexibility in structuring …
Multiple recent developments suggest that governing boards will continue to be called upon to address the personal liability concerns of corporate gatekeepers and other executives. There may be no clear indication yet of whether the Trump administration will endorse government …