Audit committee members discussed SEC regulations and enforcement, the whistleblower bounty program, CEO succession, executive compensation, and IT strategy at three peer exchanges hosted by the PwC Center for Board Governance.
Regarding the 2012 proxy season, directors participating in our audit committee seminar said:
The SEC whistleblower bounty program could be troublesome since it has the potential to bypass company whistleblower programs, which don't offer rewards leaving the company unaware of potential issues.
Many companies have expanded internal audit's role in reviewing Foreign Corrupt Practice Act issues because of the increase in these investigations.
Companies thinking about splitting the chairman and CEO roles should not do so during a sitting CEO's tenure.
More board time is needed for CEO succession planning. PwC’s 2011 Annual Corporate Directors Survey shows only one-third of the 834 directors who responded are satisfied with the management succession plans at their companies while more than half would like to see their boards devote more time to the topic.
Compensation committee members may be targeted for withhold campaigns if their companies have not responded appropriately to a negative or weak say on pay vote.
Boards could be at a disadvantage if they don’t include directors with some expertise in social media and cloud computing or don't hire outside advisors with IT experience. Recent surveys show only 8% of directors have IT expertise and only 15% use outside IT advisors.