FOR IMMEDIATE RELEASE:
The Society of Corporate Secretaries and Governance Professionals Addresses Issues for Directors in Wake of WorldCom Settlement
NEW YORK, January 12 — The Society of Corporate Secretaries and Governance Professionals sponsored a teleconference focusing on the needs of Society members following the WorldCom settlement that directed personal payouts of $18 million from the ex-directors of the bankrupt company.
Corporate secretaries and governance professionals, who work closely with boards of directors, are being asked to assist directors as they struggle with the implications of the settlement regarding the personal liability of directors and the limits of Director & Officer insurance, traditionally a shield for directors.
Society members Lydia Beebe, Secretary, ChevronTexaco Corporation; Alan Dye, Partner, Hogan & Hartson LLP; David Katz, Partner, Wachtell, Lipton, Rosen & Katz; Marilyn Mooney, Partner, Fulbright & Jaworski L.L.P.; Susan Wolf, Staff Vice President, Secretary & Associate General Counsel, Schering-Plough Corporation, took part in the call. Each spoke about ways in which corporate secretaries and governance professionals can help board members ensure that they are providing effective oversight of the corporation.
Generally, Society members agree with Martin Lipton of Wachtell, Lipton, Rosen & Katz, who has said in a memo to clients that "in order to avoid an overemphasis on process and at the same time effectively discharge the board's fundamental duties to appropriately monitor and supervise the business of the corporation, it is necessary to identify the matters on which the board should focus and to create a reasonable program to deal with them."
Susan Wolf said that her office will begin by providing directors with an outline of the facts of the settlement, along with law firm memos. Her company is planning a briefing on the WorldCom settlement, and will analyze the company's D&O insurance provisions.
Marilyn Mooney noted that Society members should also continue to help boards meet their oversight duties by following up on open issues, and documenting board processes rigorously.
The Society will have a resource page about the settlement on its Website: www.governanceprofessionals.org, to help members further. A transcript and audiofile of the teleconference will also be available to members through the Society Website.
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