November 18, 2010

Going Public? Governance Still Seen as a Big Hurdle

According to this recent KPMG study, companies planning to go public consider corporate governance to be their biggest challenge. Under the study, the top three challenges in preparing for an IPO are:

– Improving corporate governance – 64%
– Preparation of a robust business plan – 40%
– Preparation of financial track record – 36%

How long do these pre-IPO executives believe that it would take their company to prepare for going public?

– 12 to 18 months – 15%
– 6 to 12 months to prepare – 54%
– 6 months or less – 10%

The Latest Venture Capital Developments

In this podcast, Jonathan Axelrad and Anthony McCusker of Goodwin Procter discuss the latest developments impacting the venture capital community:

– What is the climate for venture capital these days?
– What types of companies are VC investors targeting?
– Are companies being funded outside the US?

Survey Results: Directors from Financial Service Sectors Weigh In

Recently, PwC held its annual Financial Services Audit Committee Forum in New York. As I understand it, it’s the biggest annual gathering of board members from across the financial services sectors, including banks, mutual funds, hedge funds, private equity firms, insurance companies, broker-dealers, REITs and related service providers in attendance. During the Forum, PwC polled attendees on several topics related board governance and financial reform:

– 28% of respondents indicated they feel their board currently spends too much time on compliance issues and not enough time on strategic business decisions
– 18% said that the Dodd-Frank Act would require their boards to take on new responsibilities traditionally handled by executive management.
– 18% also said they think that Dodd-Frank blurs the line between governance and management with regard to the role and responsibilities of board members
– As a result of financial reform, 44% said their firms’ would increase spending on compliance
– 58% of those polled believe that the tone at the top of the organization and the corporate culture set by the CEO will have the greatest impact on promoting the safety and soundness of the financial system
– Regarding new “say on pay” provisions, 83% of those polled say that are confident in the current effectiveness, quality and transparency in communicating with investors about executive compensation

– Broc Romanek