On Friday, March 10, Silicon Valley Bank was effectively taken over by the Federal Deposit Insurance Corporation (FDIC). By Sunday, March 12, Signature Bank had also been taken over by the FDIC. Then, last week, big banks such as Bank of America Corp., JPMorgan Chase & Co., and Wells Fargo & Co. pledged to deposit a combined $30 billion into First Republic Bank to curtail client panic engendered by the recent bank failures and to prevent another failure altogether. And this past weekend saw an historic merger between UBS and Credit Suisse—a move attributed to concerns over financial co ..read more

Leveraging transactions as an engine for profitable growth is nothing new. Companies have long employed mergers and acquisitions (M&A) as well as carve-outs to expand market share through acquired capabilities or geographic reach, or to fine-tune operating models for core competencies and services. But there’s more. M&A transactions can also be a catalyst for transformational change—either as the straw that finally forces a big shift, or as a more subtle nudge to hone rough edges in a company’s portfolio. When and How to Use M&A as a Catalyst for Transformation 1. When transformati ..read more

A successful navigation of the executive compensation landscape requires that you periodically scan the radar to make sure you’re on track and avoiding obstacles. As a compensation committee member, below are a few new developments you should have on your radar this spring and summer. Pay vs. Performance Disclosure Requirement Although the new disclosure requirement is not expected to have much impact for most companies, there is some headline risk for companies with either relatively high compensation actually paid (CAP) figures or apparent disconnects between CAP and company performance. Com ..read more

Recently, the Biden administration released its much anticipated National Cybersecurity Strategy. Founded on five pillars—defend critical infrastructure, disrupt and dismantle threat actors, shape market forces to drive security and resilience, invest in a resilient future, and forge international partnerships to pursue shared goals—the strategy builds on the 2018 National Cyber Strategy issued by the Trump administration, as well as several other national security memorandums and Executive Order 14028.  Though the five pillars identified in the 2023 strategy are vastly different in verbi ..read more

To the outside world, China is at once too big to ignore or sideline and deeply complex and difficult to fathom. The nation evokes that famous quote from Winston Churchill about Russia: “a riddle, wrapped in a mystery, inside an enigma.” Recent developments certainly reflect some of this mystery. After almost three years of being relatively hermetically sealed from the outside world—including to its own economic detriment—China burst back onto the global economic scene when President Xi declared in early December 2022 that the country’s zero-COVID lockdown policy was over. As he dramatically r ..read more

Today’s unprecedented pace of disruptive innovation in the market and conflicting demands of multiple stakeholders are creating relentless pressure on the CEO. Is the board contributing to the CEO’s performance and ability to function?  A recent survey of 3,000 CEOs and senior executives sheds further light on the increasing complexity these business leaders face. Three out of four CEOs report that their companies face significant disruption. Seven in 10 are concerned that their executive teams lack the agility to deal with this disruption. Almost all CEOs (98 percent) recognize they need ..read more

The US Department of Justice’s (DOJ) Corporate Enforcement Policy (CEP) is never going to be the most popular item on the board’s education agenda, but it is quickly becoming one of the most significant. With the DOJ’s renewed focus on corporate fraud enforcement and new fiduciary duty interpretations from the Delaware courts, corporate responsibility is back in vogue on boardroom agendas. Directors, especially those serving on audit and compliance committees, are now incentivized to recognize this movement and its potential implications for the company. This is particularly important given th ..read more

Six actions to make sure you’re ready when—not if—a cyberattack strikes. “Beginning today, all passwords must include sign language, thumb fingerprints, and animal noises,” read a sign in a corporate office I visited recently. Unfortunately, contemporary cyber challenges extend way beyond password protection. Among the most costly and troublesome matters facing boards today are crises created by cyberattacks and hacks. As the Wall Street Journal noted in September, “Cybersecurity has emerged as a key business risk that threatens firms’ ability to operate or even survive, and boards face increa ..read more

In March 2022, the US Securities and Exchange Commission (SEC) proposed a new rule on cyber-risk management, strategy, governance, and incident disclosure. It is as multifaceted as it sounds, and it would require certain SEC registrants to report material incidents within four business days and to make a number of disclosures pertaining to cybersecurity incidents, protocols, and risk management strategies. The proposed rule is a response to the ongoing risk cyber threats pose to public companies and their stakeholders. In January 2023, it entered the SEC’s final rule stage. The new rule emphas ..read more

While the work of public company compensation committees is well understood and receives considerable investor attention, the same cannot be said for private company compensation committees. Most private company boards don’t use standing subcommittees, so the owners lack the point of view of public company directors experienced in this type of work. For most private companies, setting executive compensation is an annual exercise that is less than optimized. Whether it is due to economic constraints or personal friendships, some important discussions just don’t happen often enough, if at all. I ..read more