December 14, 2004

Institutional Investors: What Do They Want? New Tactics and New Agendas

A few weeks back, I attended a very informative ALI-ABA conference devoted to corporate governance – here are some notes from a great panel on investor expectations. These notes are posted in Section F of our Sarbanes-Oxley Law Firm Memos.

One tale worth repeating relates to how a few companies still are willing to waive their code of ethics. Apparently, one particular company’s CEO conducted a related party transaction without bothering to get board approval. When the company’s independent auditor found this out and brought it to the board’s attention, the company waived its code of ethics and the independent auditor was fired. At least, that is the story that I heard – when I went to verify it, none of the company’s SEC disclosure stream matched up with the story. Scary!

Late 10-Q Filings

Perhaps the most fascinating anecdote in this Business Week article about late 10-Q filings – which theorizes that 404 is causing the delays – is that the number of late filings was so high last year, even without 404! The article states: “In just one week in early November, 61 companies with a market cap of $100 million or more announced they would be late with their filings, including info-tech giant Electronic Data Systems, General Motors, and Suntrust Banks. That was up 25% from the same period a year ago, according to Glass, Lewis & Co., an independent researcher.”

Canadian Law

As the number of Canadian companies registered with the SEC is far higher than any other country (other than the US obviously), we have created a “Canadian Law Practice Area.” For those practicing in this area, please let me know if you have any content to contribute!