Yesterday, in response to a directive from SEC Chair Gary Gensler, Corp Fin announced that:
1. It’s considering whether to recommend that the Commission revisit the proxy advisor rules that were adopted last summer – which would require proxy advisors to meet new conditions beginning December 1st of this year – and the Commission-level interpretive guidance that was issued the year before.
2. The Staff won’t recommend enforcement action to the Commission during the period in which the SEC is considering further regulatory action.
3. In the event that new regulatory action leaves the 2020 exemption conditions in place with the current December 1, 2021 compliance date, the staff will not recommend any enforcement action based on those conditions for a reasonable period of time after any resumption by Institutional Shareholder Services Inc. of its litigation challenging the 2020 amendments and the 2019 Interpretation and Guidance. (ISS v. SEC, 1:19-cv-3275 (D.D.C.)
This is the latest chapter in the long, ongoing saga over proxy advisors. The 2020 rules and 2019 guidance define proxy advice as a “solicitation” and would require proxy advisors to disclose conflicts of interest and adopt policies that allow for companies to review & respond to voting recommendations, in order to be exempt from the information & filing requirements that would otherwise apply to a solicitation. The amendments also specify what circumstances would cause proxy advice to be “misleading” within the meaning of anti-fraud rules.
The rules were celebrated by many companies, but proxy advisors and their investor clients criticized the proposal process, took issue with the Commission’s statutory authority, and felt that the substance of the rules would delay and impair the proxy voting process. This, in turn, made some companies worry that the proxy voting timeline would become even more compressed. As mentioned in yesterday’s Staff statement, ISS even sued the SEC over its efforts to regulate the industry, and appeared to be moving forward with that proceeding as recently as last August.
In light of those issues and the fact that the compliance date has not yet arrived, I’ve been wondering whether we’d see some steps to unwind (or not defend) the rules. Some are pondering whether this is the beginning of a trend of “back & forth” rulemaking, which would create uncertainty.
Commissioners Hester Peirce and Elad Roisman issued a response to Chair Gensler’s statement yesterday, saying that the 2020 rules were the result of an unassailable process and that there is no data yet to evaluate whether the rules work in practice. Meanwhile, CII called yesterday’s directive “Christmas in June for investors.”
The premise of one of my favorite parenting books is that standard negotiation techniques – logic, bribes, threats – aren’t going to deliver when it’s 8pm and my 3-year-old has been refusing to leave the playground for the last 45 minutes. In that situation, the only way out is to use a Jedi mind trick to reverse engineer and validate his deepest desires, and make the ride home even more magical and exciting than another trip down the 2-story slide.
It seems like that’s kind of the position that the SEC finds itself in with Elon Musk, especially after reading this WSJ article yesterday about the Enforcement Division’s attempts to follow up on tweets that the Commission believed went against its 2018 settlement with the Technoking. Here’s an excerpt:
From the start, the social-media policy was difficult for the SEC to enforce. The SEC accused Mr. Musk of violating the rules in February 2019 and asked a Manhattan federal court to consider holding him in contempt. The judge signaled she wanted the two sides to settle the dispute and they agreed to modify the policy by clarifying which topics required pre-approval. Those were identified as including communications about production figures, new business lines and the company’s financial condition.
Within months, the SEC was writing Tesla again, questioning a tweet Mr. Musk wrote on July 29, 2019, that stated: “Spooling up production line rapidly. Hoping to manufacture ~1000 solar roofs/week by end of this year.”
It’s not surprising that this notion of “pre-clearing” tweets isn’t playing out smoothly – the question all along has been, what can the SEC do about it? The WSJ says that the latest dispute, over a May 2020 tweet, appears to have ended in a stalemate. The Enforcement Division encouraged the company to apply its disclosure controls & procedures, Tesla said it hadn’t done anything wrong, the SEC threatened to go back to court, and nothing happened.
Yes, the SEC is still working through the permissible ways for companies to use social media. The board and Elon are also defendants in shareholder suits because of these tweets. Maybe for this high-profile CEO, someone also needs to find a way to make compliance as fun as public taunting.
– COVID-19 resurgence: The fight against COVID-19 falters in the developed world.
– Climate policy gridlock: Developed economies fail to take policy actions consistent with their goals to reach net-zero emissions.
– Emerging markets political crisis: Failure to arrest the COVID-19 pandemic severely stresses EM political systems and institutions.
– Global technology decoupling:Technology decoupling between the U.S. and China significantly accelerates in scale and scope.
The unique thing about BlackRock’s dashboard is that it includes indicators that show whether the risks are on investor radar screens, and it analyzes how much markets have already priced in each risk. BlackRock finds that investors have been feeling pretty good since the change in the US administration, and attention to geopolitical risks is below the average of the past four years. Unfortunately that means that if some of these risks materialize, they could catch the markets off-guard.
This HLS blog from Nell Minow predicts that we’ll see more ESG-focused proxy fights in light of the results last week at ExxonMobil. Here’s her concluding recommendation:
Every board should have a committee that oversees investor communications and lead directors should be liaisons for shareholder concerns. They should expect a lot more interest from shareholders in the quality of the board, with emphasis on independence that goes beyond resume disclosures. Wise boards will solicit suggestions from investors and make sure that all directors know that their obligation as fiduciaries is to shareholders, not executives, and that their actions make that message clear to shareholders as well. Engine No. 1 is the first of a new kind of activists; its success makes it clear it will not be the last.
Internal audit oversight is typically part of the audit committee’s charter because of listing exchange rules. It’s also part of ensuring the directors are getting quality info about the company’s risk profile & financial results.
The Institute of Internal Auditors recently launched a tool to help audit committees make sure the internal audit function is working well. Here are the sample questions it proposes the committee consider with regard to risk management:
– Does the IA activity expand the board or AC’s knowledge about current and emerging risks to the organization?
– Are there clear links between the audit plan and the organization’s strategic objectives and risks?
– Does the CAE explain to the AC how the audit plan covers challenging and critical areas, including emerging or existing risk areas that will or could impede the organization’s objectives?
A recent Law.com post from Alston & Bird attorneys Elizabeth Clark and Robert Long provides a summary of several initial court decisions involving Covid-19-related securities actions. In these cases, courts ruled on early-stage motions to dismiss and even though the decisions were mixed, the authors say plaintiffs will face major hurdles in bringing claims related to Covid-19’s impact on a company’s business operations.
Three initial decisions on motions to dismiss reflect that courts are going to closely scrutinize allegations related to COVID-19 and analyze challenged statements in view of the pandemic-related information available at the time, including scrutinizing what the company could have reasonably known at the time of its public statements.
The primary takeaway is that, even in the wake of a global pandemic and unprecedented volatility in the stock market, courts continue to recognize that the heightened pleading standard of the Private Securities Litigation Reform Act acts as a roadblock to ferret out thin and conclusory claims even at the earliest stage of a securities fraud case.
One case the authors discuss involved Norwegian Cruise Line and in that case, the court found certain company statements constituted nothing more than corporate puffery. The case emphasizes the importance of including a comprehensive safe harbor disclosure statement. In granting the motion to dismiss, the court said that many of the challenged statements were accompanied by specific, cautionary language and were protected by the PSLRA’s safe harbor provision.
Take Our Quick Surveys: Board Meeting Health Protocols & Insider Trading – COVID-19 Adjustments
We’re continuing to post memos about “return to work” and other pandemic issues in our “COVID-19” Practice Area – but one topic that isn’t getting as much attention is what companies are planning to do to keep their boards productive, cohesive & healthy. Please take a moment to participate in our anonymous “Quick Survey: Board Meeting Health Protocols”.
Many have made it through another long proxy season – as I blogged earlier this week, it’s been a wild ride this year. We wish each of you an enjoyable Memorial Day weekend, we’ll be back here on Tuesday. Please take a moment to honor and remember those who have sacrificed for our country.
This year’s wild proxy season continued yesterday when ExxonMobil announced that a dissident won at least two seats on the company’s 12-member board. The dissident – Engine No. 1 – has waged a campaign that pressures the company to set a “climate transition” plan that would result in net-zero emissions from the company – and its products – by 2050.
Considering Engine No. 1’s ownership stake in Exxon is only about 0.02%, it’s remarkable that the hedge fund pulled this off. It came at no small cost – this has been one of the most expensive proxy fights ever, with Exxon spending at least $35 million and Engine No. 1 spending $30 million. Reports are based on preliminary voting results, so until the final vote results are released it’s unclear how close the vote was for the two seats that were won. As of yesterday afternoon, there were two more seats still up for grabs. The vote was so hotly contested that Exxon called a recess during the meeting as votes were still being cast.
This WSJ article summarizes the proxy contest. Here’s a snippet about yesterday’s drama:
Both sides feverishly made their case to investors until the last minute. Exxon delayed the closing of the voting by an hour Wednesday morning and Engine No. 1 said the company was calling investors to ask them to change their votes. In a message sent to shareholders, the fund urged them ‘not to fall prey to any such strategic efforts.’
In another somewhat new practice, Vanguard posted a vote bulletin saying it backed two dissident nominees and BlackRock posted its vote bulletin for Exxon’s meeting yesterday afternoon, nearly in real time. As I blogged yesterday morning, word was already out that BlackRock was planning to support three dissident nominees. BlackRock said that, although Exxon had announced more commitments and transparency, it believes more urgent action is needed. Here’s an excerpt from BlackRock’s bulletin:
We believe that three of the four directors nominated by Engine No. 1 bring relevant private sector experience including independent U.S. energy production (Mr. Goff); renewable products, including wind energy (Ms. Heitala); and energy infrastructure, legislation and new energy technology (Mr. Karsner). Hence, we believe that this suite of directors will complement the skills and experience of the remaining incumbent directors, bringing fresh perspectives as well as successful track records of value creation for shareholders.
BIS supported the re-election of Mr. Frazier and Mr. Woods because our engagement with each of them over the past several months has given us greater confidence that they are prepared to internalize shareholder feedback, and lead the company, in their respective roles as Lead Independent Director and CEO, on a more ambitious course of action in adapting to the energy transition and responding to shareholders. We also believe some leadership stability is important in the context of the urgency with which the company is expected to deliver on its commitments.
Many predict the vote result will force the company to change its strategy, which has been fossil fuel focused. Institutional holders are signaling that they’re willing to take drastic action to reduce climate risks, which may also jolt the energy sector – and others. The vote is even more shocking in light of the fact that the company had already added three directors earlier this year in response to activist pressure, including Jeff Ubben. That means that if any additional dissidents are certified as elected, new directors would comprise at least half of the board.
As an exclamation point yesterday, shareholders not only approved a change in leadership, they also approved proposals calling for more info on climate lobbying and other lobbying activities, which weren’t supported by the board.
Whistleblower Awards Continue Rolling Along
Liz blogged back in March about a SEC whistleblower award and noted the Commission had already made 40 individual awards this year. Since then, the Commission has awarded more and last week announced a few more. First, there was an announcement of awards totaling more than $31 million in connection with two enforcement actions, with the awards divided between two whistleblowers in each action.
In the first order, the SEC awarded almost $27 million to two claimants who provided SEC staff with new information and assistance during an existing investigation, including meeting with the staff in person on multiple days. Their information and cooperation helped the Commission bring the enforcement action, which resulted in the return of millions of dollars to harmed investors.
In the second order, the SEC awarded one whistleblower an award of approximately $3.75 million and the other whistleblower an award of approximately $750,000. While both whistleblowers independently provided information that assisted SEC staff in an ongoing investigation, the whistleblower who received the larger award provided information and assistance that was more important to the resolution of the overall case.
Also last week, the Commission announced an award totaling more than $28 million and this one was in connection with an Enforcement Division action and a related action by another federal agency. Based on information received from the whistleblower’s attorneys, the WSJ reported that the award was in connection with a bribery settlement. Although the SEC’s whistleblower program provides that whistleblower’s can receive up to 30% of monetary penalties when their tips result in a successful enforcement action and when the penalties total more than $1 million, the WSJ said the $28 million award represented 10% of the monetary penalties collected from both the SEC and DOJ actions. It’s not entirely clear what led to the lower percentage award in this case, but the article does say that the settlement involved different regions than the one initially identified by the whistleblower.
Since first issuing an award in 2012, with last week’s awards, the agency has awarded approximately $903 million to 163 individuals. As these awards continue rolling along, it’s looking like it may be possible for the agency to surpass $1 billion in total awards under its program sometime later this year.
Former Chief of SEC Whistleblower Office Joins Arnold & Porter
The SEC announced back in April that Jane Norberg was leaving the agency that month, she had served as Chief of the agency’s Office of the Whistleblower. Jane had been with the Office since near its inception in 2012 serving as its first Deputy Chief and, since 2016, its Chief. With what’s seeming like pretty regular whistleblower award announcements, it appears that securities enforcement practices could see a good volume of work and earlier this week, Arnold & Porter announced that Jane has joined the firm’s Securities Enforcement and Litigation Practice as a partner in its Washington DC office. In the announcement, Richard Alexander, the firm’s chairman, commented that Jane’s joining the firm at a time when whistleblower-driven investigations and enforcement actions are ticking up. A Bloomberg piece citing Jane’s move to private practice quotes her as saying she ‘expects this administration to be very pro-whistleblower.’
Find More on Our Other Blogs!!
We are gradually resuming our blog email notifications – and hope you’ll enjoy the improvements. In the meantime, don’t forget that you can visit the blog landing pages for our latest entries. For members of TheCorporateCounsel.net, that includes Mike Gettelman’s Blog (with recent posts about NY private offerings and crypto predictions), as well as our Mentor Blog (with recent posts about director tenure, board assessments, and more).
Members of CompensationStandards.com can visit that page for recent proxy disclosure samples, via Mark Borges’ Proxy Disclosure Blog (with recent samples of corporate responsibility and perks disclosures) and for Mike Melbinger’s take on hot executive pay and related issues, via Melbinger’s Compensation Blog.
Members of Section16.net can access Alan Dye’s Section16.net Blog for news on that front (with a recent post about attorney’s fees on a profit disgorgement case).
And our free DealLawyers.com Blog is also still going strong every day with John’s M&A nuggets!
Back in December, I blogged about whether sustainability concerns would lead to more proxy contests. At that time, Engine No. 1 LLC launched a campaign to name four directors to Exxon Mobil’s board. We didn’t know then whether the campaign would continue gathering steam but it has and yesterday, Reuters reported that BlackRock intends to back three of Engine No. 1’s director nominees to join Exxon’s board. It’s not too often that you hear of a large asset manager backing dissident nominees and here, BlackRock is Exxon’s second largest shareholder, holding a 6.7% stake in the company.
Exxon’s annual shareholder meeting is scheduled for today. This Politico article takes a deeper dive on this proxy contest and says ISS and Glass Lewis made recommendations that favor Engine No. 1. Other shareholders that are reportedly supporting Engine No. 1 include CalSTRS, CalPERS, the New York State Common Retirement Fund, Legal & General and Federated Hermes. Engine No. 1’s focus of attack has been about the company’s financial performance and decision making around investment in cleaner energy and many are watching to see which way votes are cast by large asset managers. Here’s an excerpt with more:
The vote will also be watched for how certain shareholders cast their ballots. Vanguard, BlackRock and State Street, three of the world’s largest asset managers, are Exxon Mobil’s biggest shareholders. Those companies haven’t indicated how they’ll vote, but all have drawn complaints from other investors and environmentalists such as the Sierra Club, who say they have failed to deliver on their own pledges to put a premium on environmental, social and governance, or ESG, metrics.
‘I am tracking the voting records of BlackRock and Vanguard, and expect full transparency and sufficient explanations regarding the reasoning and justification for the votes BlackRock and Vanguard cast,’ Wisconsin State Treasurer Sarah Godlewski said in a written statement. ‘It is critical for the financial resiliency of our funds that asset managers hold corporate boards accountable and stop at nothing less than a guaranteed commitment to address systemic climate risk.’
The article notes that even with the support of BlackRock, Engine No. 1 doesn’t have an easy path because nearly half of Exxon’s shares are held by retail shareholders, which tend to vote with management. The article says Exxon’s 20 largest shareholders only hold 35% of the vote.
Glass Lewis Recommends Ouster of Female Board Chair Due to Board’s Gender Imbalance, Huh?
With eyes on board diversity, a recent article in the Guardian caught my eye as the headline said shareholders have been urged to vote out a board chair due to gender imbalance. As I read a little further, I was surprised to see that Glass Lewis has recommended the ouster of the board chair although the board chair happens to be a woman. Although the company, Playtech is a constituent of the FTSE 250 and UK based, the situation sends a message about how Glass Lewis could view a similar situation should it arise here.
Should Playtech’s chair be ousted, its board will be left with an even greater gender imbalance. What gives? According to the article, the board makeup includes 7 members, 2 of which are women, which is below the 33% target for board gender diversity. Although the target is voluntary, Glass Lewis takes a tough stance in holding the board, and in this case the board chair, accountable for lack of progress on improving the company’s diversity:
While the government-backed 33% target is voluntary, Glass Lewis reprimanded Playtech for its failure to follow its peers and improve its boardroom gender diversity. The company is adding another male director at its upcoming meeting, which means women would only occupy a quarter of Playtech’s board positions. Women represented just 19% of senior management, while 39% of the firm’s employees were female.
Glass Lewis criticised Playtech’s stance on improving diversity at the company, saying that it had ‘failed to adequately outline any measurable diversity objectives, instead opting for boilerplate language which provides little insight into what strategy the board is employing to enhance diversity’.
The advisory group added: ‘The board has not disclosed any commitment to achieve the Hampton-Alexander Review targets within a defined time frame despite the company failing to achieve the same by the 2020 deadline.’
There’s likely more to the story than the Guardian was able to pull together for its article. Word to the wise for companies thinking that placing a woman in a board leadership role will appease Glass Lewis to the point of looking past other diversity shortcomings, that move probably won’t help win over the folks at Glass Lewis. Also, ISS takes a similar stance for racial diversity, they’ll vote out a board leader even if they themselves are from an underrepresented community – see Liz’s blog from a couple weeks back.
Annual Meeting Season: Wild Ride in UK Too
Many will probably agree that this year’s annual meeting season is turning out to be a bit of a wild ride. Liz and I have been blogging on our “Proxy Season Blog” about some of the early vote results as several shareholder proposals have received majority shareholder support, while others, despite being first-year proposals have received over 30% shareholder support. Meanwhile, Liz blogged not too long ago about increased opposition to say-on-pay proposals this year.
For more on this year’s wild ride, last week Reuters reported that over in the UK, Lloyds Banking Group had to temporarily adjourn its annual meeting due to a shareholder repeatedly shouting complaints. According to the story, the chairman adjourned the meeting and after 15 minutes of disruption, in which the shareholder was removed and the webcast suspended, the meeting was restarted. With most companies holding annual meetings virtually, it was somewhat surprising to read about the interruption, but the FT reported that Lloyds made a last minute shift and decided to allow up to 100 shareholders to attend. Although the article says only 10 investors attended, it only takes one to bring an element of disarray to a meeting.
Back in February, three Democratic US Senators wrote to then Acting SEC Chair Allison Herren Lee urging the SEC to reexamine its policies on Rule 10b5-1 plans – Liz blogged about it at the time. Since then, Commissioner Lee responded to the Senators with a letter saying that she instructed the staff to review Rule 10b5-1 and develop recommendations for possible changes. This excerpt from Commissioner Lee’s letter touches on aspects of the Rule for which Commissioner Lee requested review:
The Commission adopted Rule 10b5-1 in August 2000 and has not substantively revisited it since then. In the intervening years, market developments and other circumstances have revealed aspects of the rule that may need to be reconsidered, including whether better disclosures about these plans are warranted. Your letter identifies a number of approaches, such as cooling off periods, that may enhance the rule’s effectiveness. With respect to disclosure, there are no specific requirements related to information about 10b5-1 plans and, while some public companies do disclose the details of transactions made pursuant to their 10b5-1 plans, many do not. Similarly, while some insiders indicate on their beneficial ownership reporting forms when transactions are conducted pursuant to 10b5-1 plans, many do not.
As part of this review, the staff will consider the points you raise with respect to public disclosure of 10b5-1 plans, cooling off periods and short-swing profits.
In their February letter, the US Senators requested feedback about the number of enforcement actions the SEC had taken with regarding to 10b5-1 plans in the last five years. They also requested information about actions the SEC takes to ensure 10b5-1 plans are compliant with SEC rules. Commissioner Lee’s letter outlines, and includes a brief summary of, the Enforcement actions brought over the last five years that include mention of Rule 10b5-1 plans and says the Enforcement Division will continue to evaluate, as appropriate, Rule 10b5-1 plans during its investigations into potential Enforcement actions.
Reforms to Rule 10b5-1 could be on the horizon. Commissioner Caroline Crenshaw reportedly views a “cooling-off” period as a solution. And, as part of his confirmation process, SEC Chair Gary Gensler’s response to questions indicate he would consider modernizing Rule 10b5-1.
To help stay on top of the latest developments, mark your calendars for July 20th and tune in to our webcast “Insider Trading Policies & Rule 10b5-1 Plans”– to hear our own Dave Lynn of Morrison & Foerster, Meredith Cross of WilmerHale, Alan Dye of Hogan Lovells and Section 16.net and Haima Marlier of Morrison & Foerster discuss the new enforcement environment, Rule 10b5-1 plan considerations for share buybacks, intersection of insider trading policies and Rule 10b5-1 plans, blackout period trends and more!
Executive Order: Climate Disclosures Get a Push From the Top
Late Thursday afternoon, President Biden issued an Executive Order on Climate-Related Financial Risk, which has been rumored to be coming for a couple months. It establishes the Administration’s policy to:
– Advance consistent, clear, intelligible, comparable, and accurate disclosure of climate-related financial risk … including both physical and transition risks;
– Act to mitigate that risk and its drivers, while accounting for and addressing disparate impacts on disadvantaged communities and communities of color … and spurring the creation of well-paying jobs; and
– Achieve the target of a net-zero emissions economy by no later than 2050.
Major highlights of the EO include:
Developing a formal comprehensive, Government-wide strategy regarding the measurement, assessment, mitigation, and disclosure of climate-related financial risk to Federal Government programs, assets, and liabilities – in order to increase the long-term stability of Federal operations;
Requiring The Secretary of the Treasury to assess, in a detailed and comprehensive manner, the climate-related financial risk, including both physical and transition risks, to the financial stability of the Federal Government and the stability of the U.S. financial system. The report issued by Treasury is to include a discussion of:
the necessity of any actions to enhance climate-related disclosures by regulated entities to mitigate climate-related financial risk to the financial system or assets – and a recommended implementation plan for taking those actions, and
any current approaches to incorporating the consideration of climate-related financial risk into Financial Stability Oversight Council (FSOC) members’ respectiveregulatory and supervisory activities and any impediments they faced in adopting those approaches.
Treasury is also required to direct the Federal Insurance Office to assess climate-related issues or gaps in the supervision and regulation of insurers.
The Secretary of Labor must consider publishing, by September 2021, for notice and comment, a proposed rule to suspend, revise, or rescind the prior administration’s rules that would limit ERISA plans’ ability to consider ESG factors in investment & voting decisions (85 Fed. Reg. 72846 and 85 Fed. Reg. 81658) – this type of action would go further than the DOL’s previously-announced non-enforcement policy for these rules and is intended to bolster the resilience of 401(k) and pension investments.
OMB and the Director of the National Economic Council, in consultation with the Secretary of the Treasury, are directed to develop options to enhance accounting standards for Federal financial reporting where appropriate and should identify any opportunities to further encourage market adoption of such standards.
The Federal Acquisition Regulatory Council is to consider amending the Federal Acquisition Regulation (FAR) to:
require major Federal suppliers to publicly disclose greenhouse gas emissions and climate-related financial risk and to set science-based reduction targets; and
ensure that major Federal agency procurements minimize the risk of climate change, including requiring the social cost of greenhouse gas emissions to be considered in procurement decisions and, where appropriate and feasible, give preference to bids and proposals from suppliers with a lower social cost of greenhouse gas emissions.
2020 Hotline & Incident Reporting: Overall Report Volume Declined Although Not Uniformly
Navex Global recently released its “2021 Incident Management Benchmark Report.” The report provides data collected from over 3000 organizations that received 10 or more hotline or other incident reports in 2020. The report’s executive summary notes that findings can only be understood within the context of Covid-19 so key measures are reviewed on a month-to-month basis. Here are a few highlights:
Overall incident report volumes decreased although not across the board. For the first time in the history of our annual benchmark the median number of reports declined, dropping to 1.3 reports per 100 employees. A month-to-month analysis reveals the extent to which this decline was driven by COVID-related events. After an initial reporting increase in March (when state of emergency and stay-at-home orders were first declared), reporting levels quickly plummeted by over 30%, reaching record lows in May. To date, report volumes have yet to return to their pre-COVID levels. While the report volume median decreased, the overall range actually increased, reflecting greater volatility and variation within the customer base. Thus, it is inaccurate to state that all, or even most, firms had a uniform experience.
Among other things, the report also found online reporting continues to accelerate while telephonic reporting has declined, anonymous reporting continued on a slow downward trajectory, and the gap between incident occurrence and reporting increased, especially in accounting, auditing and financial reporting where it increased from 16 days to 36 days.
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