The “say on pay” provision of the new Dodd-Frank Wall Street Reform and Consumer Protection Act takes effect beginning in January. Already, public companies and their compensation committees are scrambling to mitigate the risk of a potential “no on pay” vote. Even though a “no” vote is nonbinding (i.e., companies are free to shrug it off), it could create investor relations and reputation issues.

Here’s a possible preview of things to come. The article looks at some of the reasons why Motorola, KeyCorp, and Occidental Petroleum failed to receive majority shareholder support on say-on-pay votes (regarding compensation packages of named executives) this spring.

Say on pay votes are not new. more

What is the “financial reporting supply chain” and how can it be better managed in the wake of the global financial crisis?

Twenty-five senior corporate finance executives from around the world address these questions in recent research from the International Federation of Accountants (IFAC).

The postcrisis analysis follows a 2008 IFAC report that defines and examines the financial reporting supply chain.

The key insights of the more recent research (“Business Reporting Recommendations from Key Leaders”) are interesting:

• The primary responsibility of directors is performance, not compliance.

• Organizations should expand their view from a shareholder perspective to a stakeholder perspective.

• Organizations should take economic as well as social and environmental performance factors into account.

• Organizations should better integrate governance and sustainability into [corporate] strategy, operations, and stakeholder communications.

• Organizations should further improve their stakeholder communications.

Here is an overview of the report. ###

CFOs, chief risk officers, CEOs, and their reports are not the only corporate folks who have been boning up on risk management for the past 36 months.

The recent push for greater risk intelligence also extends to the board for directors.

Henry Essert, a former chief risk officer and a current executive in Ernst & Young LLP’s financial services office, identifies seven questions that directors should ask about their organization’s risk management capabilities in the following column.

Read through Essert’s questions so that you can be prepared the next time the board springs a risk-management pop quiz. more

Swine flu appears to be over, so what did we learn from a risk management perspective?

Not enough, I’m afraid.

The H1N1 flu “has largely run its course,” according to the World Health Organization’s (WHO) Margaret Chan, who announced on Aug. 10 that the virus has moved into a post-pandemic phase.

Despite the potential damage that a pandemic virus, like H1NI, can inflict on people, institutions, and businesses, my sense is that the vast majority of U.S. organizations remain ill-prepared to handle what global public-health experts view as a high probability: The world will contend with a highly damaging pandemic at some point in the coming years. more

Regulation and compliance rate as the top business risks in Ernst & Young’s annual business risk report.

Give me a break, survey respondents.

The looming threat of regulatory uncertainty qualifies as a larger risk than access to credit, talent management issues, and the challenge of entering emerging markets. Really? more