Chapter Name: WCD Boston Chapter
Event Topic: Your CEO Just Told You S/He has Cancer. Now What?
Date: May 9, 2016
Details of the Event and Guest Speakers:
Serious medical emergencies impact corporate governance on a regular basis. From Carol Bartz at Autodesk to Steve Jobs at Apple to Jamie Dimon at JP Morgan Chase, CEOs and their boards have faced sudden decisions on whether and how to disclose medical situations to investors. How do boards balance the personal privacy of the executive with the need-to-know of shareholders? Corporate governance and securities experts from Latham & Watkins will discuss emergency succession planning, disclosure requirements and common practices, and review case studies. Subjects discussed will include the following questions and more.
· When the CEO informs the board about a medical condition, how much does the board need to know about the treatment and prognosis? Does the board need to independently verify the CEO’s opinion on the subject? Will the treatment affect the CEO’s cognitive functions and if so, how should this be taken into account?
· How should the board interact with the other executives who will be affected by the reduced availability of the CEO? Does the board need to stay more closely connected to be sure certain individuals are not overloaded or resent taking on more work without the title? Is extra compensation required for these executives?
· What is the right level of involvement of the board during the CEO’s medical treatment? Should the chair/lead director take a more active role and if so what should this be?
· Once the board and CEO agree on the temporary governance plan, what is the timing and method for this to be communicated to shareholders, customers, and employees?
· What happens if the CEO’s treatment takes longer than initially planned or recovery is not as expected? What are the responsibilities for internal and external disclosure obligations? How does the board stay current on the status of the CEO’s health?
· How long is it reasonable for a board to “hold” a CEO’s job for an individual who is not able to fully fill the position? What are the risks that potential successors will leave if a CEO remains in the role when it is clear to others that s/he should step down?
· What can boards do to be prepared in advance for a medical emergency?
Biographies of Presenters:
Peter Handrinos is a partner in the Corporate Department of Latham & Watkins. He represents companies in business combinations, securities offerings and corporate governance matters. Pete’s public company clients include American Superconductor, LPL Financial, Momenta Pharmaceuticals, Press Ganey, Radius Health and Seres Therapeutics.
Phil Rossetti is a partner in the Corporate Department of Latham & Watkins. Phil’s practice focuses on corporate and securities law, with an emphasis on mergers and acquisitions, private equity and public offerings. He regularly counsels private and public companies on corporate governance matters. Phil’s clients include Watts Water Technologies, Constant Contact, Palladin Consumer Retail Partners and numerous private technology companies.