Investor advocates are turning the spotlight on the corporate governance practices of newly public companies that they regard as hostile to shareholder interests. In connection with their IPOs, most companies adopt customary defensive measures to protect themselves from activist investors, who might otherwise take advantage of their typically smaller market capitalizations to try to seize control of the company. These measures often include a classified board of directors, whose terms are staggered over three years. … More
Monthly Archives: January 2017
Relying on Last Year’s Risk Factors is Risky
The SEC routinely advises companies drafting risk factors to start from a blank sheet of paper and avoid boilerplate. As with many best practices, this recommendation is often aspirational.
Most companies do, however, take care in reviewing last year’s risk factors to make any necessary updates and additions. As public companies prepare their annual reports on Form 10-K for fiscal 2016, they should consider the blank sheet of paper and think carefully about how their business risks are likely to change in 2017 as a result of the new political environment.… More