Recent Developments in Executive Compensation
March 02, 2004
Although executive compensation has been the subject of evolving reform for several years, the bright spotlight of public attention is now focused on this issue, due in part to the bursting of the stock market bubble, the collapse of Enron, and a number of other highly publicized corporate scandals. The image of executives enjoying excessive compensation packages as revenues and earnings decline, and stock values of the companies they manage plummet, is a dangerously common stereotype.
Internal Control Reports: The Next New Thing
March 02, 2004
Many public companies have already begun to prepare for compliance with Section 404 of the Sarbanes-Oxley Act of 2002 (the Act). Management and directors may not be clear on the framework for Section 404. Although Section 404 does not require disclosure in Annual Reports for the calendar year-end 2003, requisite lead times suggest that by now companies must be working diligently on compliance planning.
Digital Stealth Secrets and the Act
March 02, 2004
Corporate accountability (Section 302, 404 and 409 of SOA) has moved to priority status for most businesses. This article has as its core just one premise: understanding the risks associated with digital stealth fraud in the workplace, and what it can do to your company.
Concerns About Outsourcing
March 01, 2004
A popular managerial concept for over two decades, outsourcing now holds even greater appeal as large numbers of lesser-paid, skilled workers become accessible through improved telecommunications and workflow management techniques. As convincingly depicted in Lisa R. Smith's accompanying article, the direct cost advantages of outsourcing are stronger than ever, and at least some outsourcers are providing high quality service even for security-sensitive functions previously kept in-house. During the current jobless recovery, however, outsourcing is rapidly turning into a political hot button. Its globalized variants, "job exporting" and "offshoring," are already red hot. Although some political discussants appear self-interested and even demagogic, it's clear that widespread outsourcing is indeed associated with serious societal problems ' and probably not just in the short term.
Outsourcing: The Next Generation
March 01, 2004
Outsourcing is top of the news in many industries, and the legal industry is no exception. Recent news reports and editorials comment exhaustively on many aspects of outsourcing, and for any of those aspects you can find someone who will opine convincingly at either end of the spectrum. Many large firms have taken the step of locating a portion of their back office outside a principal office, including, as was described in the January interview with Ralph Baxter, Orrick's Global Operations Center in West Virginia. These arrangements, while generally a great move for the firms, should not be confused with outsourcing because the services are still being provided within the firm. However, they may certainly be a viable alternative to outsourcing.
If It Ain't Lawyering, It Must be Marketing
March 01, 2004
Few jobs in the world are more rewarding than the role of a marketing professional at a law firm. Where else can someone talk to the greatest legal minds, reporters from the Wall Street Journal and the General Counsel of a Fortune 500 company in one day? Add to this the situation where the concept of marketing is changing almost on a daily basis, and you have a dream position for a talented, visionary marketing guru. However, as any in-house veteran will tell you, some aspects of the actual job were not specifically mentioned in the job description. Professionals strongly lobby for grandiose titles such as Chief Marketing Officer or Global Director of Business Development when they first enter their firm. It looks great on a business card. It also really impresses people at your next high school reunion and can compensate for the extra 20 pounds you might be carrying since people last saw you on prom night.
IM: Plenty of Benefits, But Risks Too
March 01, 2004
Like many other businesses, the financial sector has embraced e-commerce as a way of expanding. Today, online banking is fairly common. Many financial institutions offer a variety of products and services for commercial and retail customers. And the finance market is mirroring wider use of all things "e" by taking e-business a step farther with the use of instant messaging (IM) to provide faster customer-inquiry responses. But although IM use often allows them to provide better customer service, it also exposes institutions to a variety of potential risks.
Audit Committee Members: the Act Affects You!
February 06, 2004
The recent and seemingly endless series of high-profile corporate scandals and failures has caused the investing public and regulatory authorities to become increasingly concerned about corporate governance and financial disclosure. The congressional response to this concern, the Sarbanes-Oxley Act of 2002 (the Act) contains, among many other provisions, significant enhancements to the responsibilities of audit committees. As a result of the Act, audit committees can no longer be rubber-stamping "yes-men" in corporate governance. They must now meet specific qualifications of financial literacy and independence, and exercise reasonable diligence and good faith judgment in the monitoring of management, and internal and external auditors. If they do not, they could subject the company and themselves to shareholder lawsuits and the company to SEC actions and/or being de-listed by their respective exchange. The provisions of the Act that directly affect audit committees are presented by title and section and discussed in this article.
