Emory Corporate Governance and Accountability Review

Volume 5Issue 2
Essays

A Call to Action: Cybersecurity Due Diligence in Today’s Business Climate

Steven Grimberg & Mark Ray | 5 Emory Corp. Governance & Accountability Rev. 73 (2018)

These days it is the rare news cycle that goes by without referencing the latest cyber-related data breach to impact some fill-in-the-blank, well-known consumer-based company. Long gone are the days where executives and Board members did not worry about cybersecurity for their respective organizations, but incredibly too many of them continue to admire the problem or pretend that “it won’t happen to us” until, well, it does. So, what can be done about it? The answer, consistent with traditional views of corporate governance best practices, is to engage in due diligence–proactive action by asking the right questions to the appropriate personnel both internally within the company, as well as externally. The common denominators of good cybersecurity preparedness, regardless of size, scope, or industry, are front-end assessments, planning, and testing.

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Effective Compliance Means Imposing Individual Liability

Reuben A. Guttman | 5 Emory Corp. Governance & Accountability Rev. 77 (2018)

Deputy Attorney General Sally Yates said it in a memo dated September 9, 2015, and her successor, Rod Rosenstein, said it in remarks dated October 6, 2017: corporations act through individuals, and compliance enforcement must necessarily account for holding individuals liable for the wrongs they orchestrate under cover of the corporate umbrella. The logic is reasonable and necessary. We blame corporations for catastrophic environmental events, misbranded drugs that cause injury, and financial products that destroy the life savings of those who have toiled for a living; yet at the helm of the corporations—guiding their path of impropriety—are people, many of whom who have benefited handsomely from the corporate misconduct that they have captained. Unfortunately, in comparison to the guilty pleas that are taken by corporations, which cannot be put behind bars, prosecutors—both criminal and civil—barely scratch the surface when it comes to pursuing the individual human culprits.

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Runnable, Ruinable Repo and the Great Recession: A Panic-Proofing Approach to Financial Regulation

Aaron Metviner | 5 Emory Corp. Governance & Accountability Rev. 85 (2018)

This Paper argues for a sort of Gorton/Ricks hybrid approach to panic-proofing, whereby the federal government (1) insures the very-short-term repo obligations of the SIFIs (while also ensuring the high-quality of the collateral under those repo agreements) and (2) limits the exposure levels of the SIFIs to all other forms of uninsured runnable debt.

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Thick as Thieves? Big Pharma Wields Its Power with the Help of Government Regulation

Leslie E. Sekerka & Lauren Benishek | 5 Emory Corp. Governance & Accountability Rev. 113 (2018)

Americans are barraged by an endless flow of ads that claim to remedy medical maladies with prescribed drugs. The commercials depict productive and happy lives, with suggestive associations that human flourishing can be achieved via pharmaceutical intervention. The appeals are accompanied by an exhaustive inventory of potentially negative life-altering side effects. As ads end with this depiction of relational bliss through drug use, viewers hear a fast-paced listing of monotone non-segmented disclaimers, which can range from modest impacts (e.g., slight weight gain) to very serious implications (e.g., suicidal ideations). Research suggests that hearing about the risks of use may increase consumers’ trust in the advertising. Sufferers may also conclude that stronger means better (i.e., helping them more effectively manage their condition). When it comes to health, consumers tend to mitigate the risk of taking drugs. Cognitive dissonance fuels a process of rationalizing side effects as part of the cost of wellbeing.

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Is the Corporation an Enemy of Democracy? How to Give the Corporation a Little Soul

Paul J. Zwier | 5 Emory Corp. Governance & Accountability Rev. 143 (2018)

In his masterful book, GREAT TRANSFORMATION, Karl Polanyi theorized that laissez faire market capitalism had within it the eventual demise of democracy. He argued, in effect, that the myth free markets would magically most fairly distribute goods and services among is citizens would become a “bad seed,” that would grow to choke out democratic decision-making. In other words, once citizens in a democracy lose jobs and pensions, and get pay cuts, and pay ever increasing prices for medical care, they start to see themselves as pawns in a rigged system justified by free market formulas that are hard to understand. Add in further loss of life savings and investments when markets correct, and the combination of theory and loss will make these people to feel that their lives and fortunes were beyond their control.

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