The global debate surrounding CEO compensation remains important and contentious. While many countries have implemented advisory frameworks for say-on-pay votes, Israel has taken a pioneering approach with its binding dual-majority voting system. Introduced in 2012 through Amendment 20 to the Companies Law, this mechanism seeks to align executive pay with shareholder interests. By granting minority
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Wilson Sonsini Discusses the New National Security Rules for Investing U.S. Capital
In late October 2024, the U.S. Treasury Department (Treasury) issued its final rules (the Outbound Rules) implementing President Biden’s Executive Order (EO) 14105 on “outbound” U.S. investment. See our prior mailers here and here. The Outbound Rules will take effect on January 2, 2025, and will add a new layer of diligence to most
How Classified Boards Have Evolved Over the Last Thirty Years
Classified boards, which divide directors into staggered classes with only one class standing for reelection annually, have long been considered a powerful defense against hostile corporate takeovers. Despite their widespread use, they remain a topic of intense debate. While studies have provided mixed evidence of whether the benefits of classified boards outweigh their costs, more
CFTC Releases Enforcement Results for FY 2024
The Commodity Futures Trading Commission today announced record monetary relief of over $17.1 billion for fiscal year 2024. With the resolution of digital asset cases that resulted in the agency’s largest recovery ever, this record amount included $2.6 billion in civil monetary penalties and $14.5 billion in disgorgement and restitution.
In FY 2024, the agency
Revisiting “Truth in Securities Revisited:” The SEC Disclosure Regime in the New Millennium
The system of disclosure for public companies no longer meets the needs of investors and other stakeholders. Largely put in place by the Securities and Exchange Commission in 1982, the principles underlying the system have failed to keep pace with shifts in the market and dramatic changes in technology. The system requires a paradigm shift
Sullivan & Cromwell Discusses Director and Creditor Liability in Distressed Companies Under Delaware Law
On November 15, 2024, the Delaware Court of Chancery found that certain of the directors of Bridge Street Worldwide, Inc. (“BSW”), a Delaware corporation, were liable for breaching their fiduciary duty of loyalty by entering into a forbearance agreement with BSW’s creditor, Domus BWW Funding LLC (“Domus”), a subsidiary of Versa Capital Management, LLC (“Versa”). The
About Face: How Much of Current SEC Policy Will the Trump Administration Reverse?
The future of the Securities and Exchange Commission (“SEC”) is currently uncertain. Given the Trump election, Republican majorities in both the House and Senate and soon at the SEC, we focus on what may happen next and, even more importantly, on what can be done to resist foolhardy changes.
Many straws are now in the
Wachtell Lipton Discusses Prospects of Legal Clarity for Cryptoassets
A resilient cryptoasset industry is emerging from weathering years of headwinds — from edicts prohibiting the banking of the industry, to an SEC leadership bent on aggressive regulation-by-enforcement in lieu of transparent rulemaking. Looking ahead, tailwinds abound: Bitcoin and Ether exchange-traded products, approved just this year, already have over $150 billion in assets under management. Leading
Why Companies Choose CEOs from Outside or Within
The decision to appoint a new CEO is among the most critical and strategic choices a corporation can face, as it can significantly influence the organization’s future. A key consideration is whether to promote an internal candidate or recruit one from outside. While internal candidates often ensure continuity and cultural fit, external hires can bring
Chapman & Cutler Discusses Credit Risk Transfer, Simplified
A well-trodden path for banks to achieve regulatory capital reductions by mitigating credit risk is through a synthetic securitization, either by issuing credit-linked notes (CLNs)1 or engaging in bespoke bilateral credit derivative transactions. These transactions—while complex to execute—offer the significant advantage of transferring risk on a large, diversified portfolio of obligors, allowing investors to evaluate