U.S. Multinationals Make Sweeping Changes in Corporate Governance, PwC Finds:
Finds New relationship evolving between board and management
(SmartPros) -- The relationship between management and boards of directors at U.S. multinational companies has been changed dramatically through an array of corporate governance initiatives begun in response to corporate scandals, the Sarbanes-Oxley Act, and other requirements.
According to the report by PricewaterhouseCoopers:
* 88 percent of senior executives report that directors at their company are expected to have more input on a variety of issues.
* 73 percent say their board will be more vocal on risk identification and risk management.
* 72 percent say their company has established a 'whistleblower' complaint process, as required by Sarbanes-Oxley, even though this provision is not yet in effect. Five percent of these report an increase in the number of complaints received and addressed by the audit committee.
* 64 percent report that their audit committee reviews the company's 10-Q prior to filing with the SEC.
* 63 percent have made changes or improvements in the skill sets of their audit committee.
* 57 percent of audit committees and 47 percent of boards have performed a self-assessment in the past 12 months.
'Boards and audit committees at large corporations have responded actively to the call for change and have accomplished a lot,' said Garrett Stauffer, of PricewaterhouseCoopers' U.S. corporate governance practice. 'We expect the increased attention and focus on governance will continue.'
Among other governance initiatives in place:
* 46 percent have a formal process for evaluating auditor performance.
* 43 percent have revised their audit committee charter as a result of Sarbanes-Oxley or proposed stock exchange listing standards.
* 31 percent of audit committees have engaged outside advisors to assist in meeting new requirements.
* 28 percent have appointed, or plan to appoint, a lead director or non-executive chairman, since passage of Sarbanes-Oxley."