Unless you have been a hermit, you are likely to have been inundated with stories in the last few months about options backdating. What else is there to say? For many, the current conversation that underlies these scandals is far more interesting; namely, not what happened, but who let it happen? Specifically, people are wondering where were the lawyers in all of this. None of this could have happened if they were not around to paper the deals, could it?
This issue is of more than passing concern to my organisation, the Association of Corporate Counsel, and to its 20,000-plus members (who work in more than 8,000 corporations in 55 countries); in-house counsel are on the front lines of corporate governance reforms and compliance, and are rightly in the spotlight when questions like this arise. So why did corporate counsel in companies where options scandals hit not prevent these problems, and what lessons can we learn from this experience?
