We recently wrote a three-part article series for Corporate Counsel highlighting recent trends warranting review by public companies and consideration as to whether to update their insider trading policies and training.
- Part One offered practical guidance on mitigating risks associated with employees who may inadvertently share confidential information with others. As the benefits of remote work options increasingly pull the workforce out of the office, companies face risks from employees removing sensitive company documents from the secure confines of their offices and company databases. Because information removed from the safety of a corporate office or database is susceptible in many ways to being taken and misused by bad actors, it is important for in-house counsel to take steps to ensure their insider trading policies and training cover this area.
- Part Two discussed practical suggestions to comply with U.S. Securities and Exchange Commission (SEC) guidance to public companies that insider trading policies should address cybersecurity risks. A recent SEC release addressed the application of the insider trading prohibitions in the cybersecurity context and expressed the SEC’s view that it is important for companies to have well designed policies and procedures to prevent trading on the basis of material non-public information, including information relating to cybersecurity risks and incidents.
- Part Three provided a primer on potential legislative changes involving stock trading plans (aka 10b5-1 plans) routinely relied on by corporate insiders to trade their company’s stock legally. Recently, these plans have been scrutinized by the media, academia and government officials for being prone to manipulation by insiders.
For more information on insider trading policies and training, feel free to contact of us or check out our Securities Enforcement & Compliance practice overview.
About Bass, Berry & Sims’ Corporate & Securities Practice
Public and private companies of all sizes across a variety of industries turn to Bass, Berry & Sims for counsel on a wide range of corporate matters, including mergers, acquisitions and dispositions; capital markets transactions; executive compensation issues; corporate governance; and shareholder activism. We serve as primary corporate and securities counsel to more than 35 public companies and have counseled on 150 deals ranging in size from $20 million to more than $15 billion over the past two years.