The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2021”. In 2020, the COVID-19 pandemic, economic uncertainty, divisive politics and a historic social justice movement presented unprecedented challenges for boards. While the pandemic eliminated the concept of an in-person boardroom, as well as investor site visits, one-on-one meetings at conferences and strategy retreats, work did not slow, and most directors reported devoting…

In 2020, many directors and members of senior management faced their most challenging year ever. Maybe the lessons of such a turbulent year will prove sufficient for 2021, but that seems unlikely. To prepare this memo, we asked our colleagues in a wide range of disciplines to boil down what we learned from last year, and to look around the corner for what to expect in 2021. The result is a compendium of the trends…

At the end of last year, Institutional Shareholder Services (“ISS”) released a handful of updated FAQs on equity compensation plans and compensation policies as well as a slightly updated pay-for-performance mechanics statement; there were no substantive changes to the peer group FAQs.[1] In addition to providing the 2021 Burn Rate Benchmarks for ISS equity plan evaluation (which are effective for shareholder meetings on or after February 1, 2021), the updates address questions regarding the…

Over a year ago, on December 29, 2019, the Sustainable Finance Disclosure Regulation entered into force. Just a few months remain before key provisions begin to apply and asset/fund managers and other financial services firms should not delay in preparing for new disclosure requirements. The SFDR requires European financial firms to consider how sustainability risks are incorporated into their investment decision-making processes, and the extent to which their financial sector remuneration practices are consistent with…

On December 18, 2020, the Internal Revenue Service (“IRS”) issued final regulations (the “Final Regulations”) under Section 162(m) of the Internal Revenue Code (the “Code”), as amended by the 2017 Tax Cuts and Jobs Act (the “TCJA”). Section 162(m) limits the deductibility of compensation paid in any year to certain public company executives to $1 million. The Final Regulations provide further guidance on the TCJA’s amendments to Section 162(m) and are generally consistent with the…

In In re Nine West LBO Securities Litigation, Case No. 20-2941 (S.D.N.Y. Dec. 4, 2020), U.S. District Court Judge Jed Rakoff denied a motion to dismiss claims brought by the Nine West liquidating trustee against former directors of Jones Group (the predecessor to Nine West) for breach of fiduciary duty and aiding and abetting breach of fiduciary duty stemming from a 2014 going-private transaction with private equity sponsor Sycamore Group.  While it remains to be…

Last week, the Delaware Supreme Court affirmed the Delaware Court of Chancery’s decision in Lebanon Cnty. Emps. Ret. Fund v. AmerisourceBergen Corp.,[1] a closely watched appeal in which the court clarified the circumstances in which stockholders are entitled to demand books and records to investigate allegations of mismanagement pursuant to Section 220 of the Delaware General Corporation Law.  In a decision that will likely continue the recent trend of an increasing number of Section…