December, 2006

Determinations and Disclosures

By Scott D. McKinney

Director independence continues to be a focus of investors and regulators, as evidenced by the new director independence and related person transactions disclosure rules of the Securities and Director independence continues to be a focus of investors and regulators, as evidenced by the new director independence and related person transactions disclosure rules of the Securities and Exchange Commission (SEC), which accompanied the more renowned changes to the SEC’s executive compensation disclosure requirements. This article discusses these new SEC disclosure rules as well as the independence criteria and disclosure rules of the New York Stock Exchange (NYSE) and Nasdaq. We review guidelines of proxy advisers, focusing on use of categorical standards to strengthen applied independence criteria, as appropriate, and to filter out certain immaterial relationships that would otherwise need to be specifically considered by a listed company’s board in assessing independence. This article summarizes several of the more common types of categorical standards and variations within such standards. Finally, this article provides compliance practice tips.

Subscribers: click here for the full story

Non-Subscribers: click here to subscribe

Pay per view ($15.00)