January 8, 2021

Podcasts! Podcasts! Podcasts!

If you’re looking for an easy way to connect the dots on disclosure and ESG issues, we’ve got you covered with podcasts! Sit in on a convo between Dave Lynn and his guests on our “Deep Dive With Dave” series, or get governance highlights from my interviews of members of our community. Check out our latest episodes below – and you can also visit our podcast page for new postings:

In this 23-minute episode, Dave and WilmerHale’s Lillian Brown discuss these shareholder proposal developments:

– Key takeaways from the 2020 proxy season

– Evaluating the SEC Staff’s approach to no-action requests in 2020

– Should I include a board analysis in my shareholder proposal no-action letter?

– New and revised proposal topics for 2021

In this 30-minute episode, Dave and our own John Jenkins give a “risk factor workshop” for companies preparing to comply with the SEC’s amendments to Item 105 of Reg S-K and to explain the impact of the pandemic. Dave and John built on the very practical “Best Practices for Drafting Your Risk Factors” in the January-February 2018 issue of The Corporate Counsel newsletter and covered these topics:

– Tackling the amendments to Item 105 of Regulation S-K

– Hypothetical risk factor language – where are we now?

– What should I do with my COVID-19 risk factor in the next Form 10-K?

– What are some other risk areas for 2021?

– John’s risk factor tips

In this 13-minute episode with EY Partner and former Corp Fin Chief Accountant Mark Kronforst, Dave and Mark examine the Reg S-X amendments for disclosure about acquisitions & dispositions, including:

– How significant are these changes to Regulation S-X for public companies?

– How do the new significance tests work?

– Will companies need to provide more pro forma financial information?

– Do the changes to the significance tests affect disclosures outside of Rule 3-05, such as Rule 3-09?

– What potential pitfalls should companies consider with this new approach?

– When do these changes go into effect and how does early compliance work?

In this 15-minute episode, I talked with Alan Smith, chair of Fenwick & West’s corporate group, about the phenomenon of virtual board meetings. We covered these topics:

– What special issues exist for boards of directors who are meeting in a virtual format

– What should board advisors be doing to ensure that the board meetings are secure from a technology perspective and that all document retention policies are being followed for notes or recordings

– What are some effective practices to encourage the type of dialogue and interaction that boards would have at an in-person meeting

– Beneficial “virtual” practices that could continue after the pandemic

– Recommended steps for companies who are bringing on one or more directors while we’re in this environment – either because they’re newly public or just because of regular refreshment practices

– Traps for the unwary that board advisors should be watching for

Lastly, I continue to team up with Courtney Kamlet of Vontier to interview “Women Governance Gurus” about their career paths – and what they see on the horizon. Feedspot recently ranked us as one of the “Top 15” corporate governance podcasts on the web. Check out our latest episodes:

Kristina Fink, Vice President, Group Counsel, Deputy Corporate Secretary at American Express

Tanuja Dehne, President & CEO of the Geraldine R. Dodge Foundation and a public company board member

SEC Rulemaking: Will 2020’s Efforts Be Undone?

Our colleague Mike Gettelman blogged earlier this week about the prospect of recent SEC rulemaking being undone by the Congressional Review Act – a complicated and rarely used law that allows Congress to overturn rules adopted by federal agencies like the Commission. Mike cited 11 rules adopted by a 3-2 vote since July, which could be vulnerable to this clawback.

In the year-end report on the activities of the Office of the Investor Advocate (which is required to be delivered to committees in the House and Senate), Rick Fleming also called for the SEC to reverse several of its own rules, including:

– Rule 14a-8 Amendments – arguing the rules diminish the ability of shareholders with smaller investments to submit proposals and disagreeing with the economic analysis in the rulemaking

– Proxy Advisor Rules – saying investors shouldn’t be forced to pay for feedback mechanisms for companies and that the rules may result in the suppression of dissenting views

– Private Offering Harmonization – expressing a concern with the continued shift of capital-raising from public to private markets

The report also urges the Commission to adopt rules about ESG disclosures, making companies’ SEC filings machine-readable and minimum listing standards for all stock exchanges. Time will tell whether the SEC under the new Administration will revisit – or refine – activities under former Chair Jay Clayton, or will prioritize other initiatives.

A Corner of Normality

What a week. I blogged on Wednesday about BlackRock’s new expectations for political spending disclosure and also on our Mentor Blog about the CLO’s role in CEO “activism.” By the end of that day, a major trade organization which counts 14,000 companies in its membership ranks called for the Vice President to invoke the 25th Amendment. The Business Roundtable, the US Chamber and several individual CEOs also issued statements condemning the assault on the Capitol and the threat to the peaceful transition of power.

On the one hand, it’s difficult to focus on “business as usual” in the midst of the events of this week and the past year. But I, for one, also appreciate having a corner of normality – some form of connection to each other, some info that can make work easier and maybe even some entertainment. We’ll do our best to continue to offer stability – and an alternative to doomscrolling.

Liz Dunshee