Devoted to Corporate Attorneys, Corporate Lawyers, and Corporate Counsel

Mark Leahy, of Fenwick & West, facilitated an event on corporate governance issues on November 17, 2006. Other speakers at the event were: Rich Brenner, CEO, The Brenner Group, Leinani Nakamura, Partner, Mohler Nixon, Tom Sa, Executive Vice President and Chief Administrative Officer, Bridge Bank. Noteworthy discussions during the event included: Criticisms of corporate executives go back as far as the 1980s with outcry against the behavior of the banking industry. During the 1980s, federal mandates helped to reform that industry. Some believe Sarbanes-Oxley 2002 corporate governance requirements might do the same for corporate America, and may be worth the administrative and financial burden for complying with these requirements. As a result of Sarbanes-Oxley, boards are more involved as the duty of loyalty and the duty of care requiring members to meet frequently and to understand the issues is enforced. With more involvement and participation and ownership from executive leadership, from certification requirements, higher integrity, better accountability, better communications, better transparency result. The requirement for independent auditors and an audit committee assists in ensuring better internal controls, cleaner partnerships with independent auditors, more proactive ownership of issues, earlier notifications of problems, earlier preparation. The code of conduct for CEOs, CFOs, Directors and other staff has assisted in ensuring clear guidelines for behavior and breaches in conduct. The disclosure requirements encourage transparency of communication and proactive management. Private companies are encouraged to prepare for Sarbanes-Oxley Section 404 compliance, with testing, before they become public. Some of the consequences of Sarbanes-Oxley: (1) time, money required to comply with Sarbanes-Oxley standards results in opportunity costs for other company projects, (2) finance professionals, particularly at the senior level, are more in demand, (3) fewer companies are deciding to go public, and more are going through M&A exits.