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Survey Results: D&O Questionnaires

By broc

Survey Results: D&O Questionnaires

We recently wrapped up our Quick Survey on D&O Questionnaires practices. Below are our results:

1. When we update our D&O questionnaire each year, the following groups review it before it's sent to the D&Os:
- Outside law firm - 37.1%
- Independent auditor - 5.7%
- Finance department - 1.4%
- General counsel - 57.1%
- Executive compensation department - 4.29%

2. Our _______ has overall responsibility for the "master" D&O Questionnaire to be sent out each year:
- Legal department - 64.9%
- Finance department - 0%
- Corporate secretary - 21.1%
- Outside counsel - 14.0%

3. Before we distribute our D&O Questionnaires, the company "pre-completes" responses in the following sections for review and acknowledgement by each individual respondent:

- We ask respondents to provide all information without pre-completing - 9.0%
- Compensation information, except for the perks - 16.7%
- Compensation information, including the perks - 16.7%
- Equity ownership, including beneficial ownership - 53.9%
- Section 16 compliance - 24.4%
- Biographical information - 59.0%
- Related-party transactions - 18.0%
- Independence - 16.7%
- Audit committee financial expertise - 18.0%

4. To assist respondents in identifying related-party transactions, we provide the respondents with a list of the company's vendors, customers or other counterparties:
- Yes - 14.6%
- No - 85.5%

5. To assist in identifying related-party transactions, we compare known information about respondents' affiliations with a list of the company's vendors, customers or other counterparties:
- Yes - 59.6%
- No - 40.4%

6. After sending the D&O Questionnaire, the company's follow-up with respondents consists of:
- Reviewing responses with all respondents individually - 1.8%
- Reviewing some responses with respondents individually if questions or issues arise - 86.0%
- Answering questions from respondents about particular questions or issues if they arise - 66.7%
- Little or no interaction with the respondents - 10.5%

7. After receiving the D&O Questionnaire responses, the company reviews the responses (or a summary report) with the following:
- Full board of directors - 23.4%
- Governance and nominating committee - 57.5%
- Compensation committee - 4.3%
- Disclosure controls committee - 14.9%
- Relevant departments - 36.2%
- Outside counsel - 42.6%

8. Our company retains the D&O questionnaire responses for a period of:
- Until the proxy statement is filed (we essentially don't retain them) - 1.8%
- For about one year (roughly until the next year's questionnaire is drafted) - 5.3%
- Between 1 and 3 years - 21.1%
- Between 3 and 5 years - 19.3%
- Between 5 and 7 years - 28.1%
- More than 7 years - 24.6%

Use of Corporate Plane for Directors to Attend Board Meetings

As we are reminded by this recent note from the "The Race to the Bottom" Blog, personal use of corporate aircraft continues to be a controversial issue. But what about when outside directors get flown to - and/or from - board meetings? How do companies deal with that?

That is the subject of our latest "Quick Survey - Corporate Airplane Use by Outside Directors." Please take a moment to answer the question posed.

"4th Annual Proxy Disclosure Conference": Early Bird Follow-Up

The early bird offer that expired Friday resulted in great momentum, with a record number of members signed up so far for the "4th Annual Proxy Disclosure Conference" (whose pricing is combined with the "6th Annual Executive Compensation Conference") – that will be held in San Francisco and via Live Nationwide Video Webcast on November 9-10th.

Our New "Early Bird" Rates – Expires May 22nd: Still recognizing the hard economic times we face-and in response to requests from members who were not able to submit their registrations by the deadline-we are offering a reduced rate for the Conferences through May 22nd.

For example, you can attend in San Fran for only $995 if you register by May 22nd (reg. rate is $1295) – and it's only $495 if you also attend the "17th Annual NASPP Conference" (which starts right after the Proxy Disclosure Conference). Here is the Conference registration form – and here is the agenda.

With Congress poised to consider legislation mandating say-on-pay (expected to be introduced by Sen. Schumer soon) – and SEC Chair Schapiro recently stating that there will be new proposals to change the executive compensation rules in the near future - this year's Conferences are a "must." Register now and take advantage of these favorable rates.

- Broc Romanek

Full post as published by The Corporate Counsel.net Blog on April 30, 2009 (boomark / email).