Public Companies

A public company’s good reputation is essential to instilling confidence in investors and attracting and retaining investment capital.  Promontory conducts internal fact-finding investigations and control reviews to help prevent or respond to regulatory and compliance failures that may negatively affect an issuer’s reputation and relationships with its investors, regulators, and other stakeholders.  Our reviews and assessments look at corporate governance, compliance programs, internal control structures (including internal audit), financial and accounting matters, and disclosure systems.   

Representative Assignments

• For a large, global SEC registrant, Promontory conducted a comprehensive, company-wide review of the effectiveness of its compliance and ethics program.  We evaluated the program based on standards established by the U.S. sentencing guidelines and industry best practices.  We assessed the compliance and ethics program’s (1) policies, procedures, and systems, (2) governance, supervisory, and operating structures, (3) training, (4) monitoring, auditing, and periodic risk assessments, and (5) promotion and enforcement.  Promontory submitted a report to the company’s board of directors that outlined our findings and detailed our recommendations to strengthen the company’s compliance and ethics program.

• In connection with an SEC investigation and a related bank inspection of a large multi-state diversified financial holding company, Promontory conducted a comprehensive review of the company’s enterprise-wide control and risk-management environment.  The SEC’s investigation centered on whether the company prepared its financial statements using accounting principles that were not in conformity with GAAP.  As a condition of settling the various regulatory inquiries, Promontory’s team reviewed and analyzed the company’s (1) governance and management structure, (2) internal audit and control functions, (3) regulatory reporting, and (4) risk-management structure, including compliance and financial reporting and accounting systems.  Promontory prepared four reports — submitted to the client and the government — outlining our findings and detailing our recommendations to strengthen the company’s control environment.

• As part of a settlement of a threatened proxy contest, we conducted a study of a public company’s corporate governance practices compared with the practices of similar public companies in four areas: (1) related-party transactions, (2) director independence, (3) disclosure of related-party transactions and director independence, and (4) the use of shareholder rights plans and classified boards and other corporate governance practices.  We also reviewed the public company’s implementation and operation of its policies and procedures in these four areas.  We issued a report to the company’s board with our findings and recommendations for improving the company’s corporate governance policies, procedures, and practices.    

• Promontory assessed a publicly traded bank holding company’s programs for corporate governance, enterprise-wide compliance, and internal audit.  We presented our findings and recommendations to the company’s board of directors, and delivered to senior management detailed action plans to implement our recommendations.  At the request of the client, we also presented our findings and recommendations to the company’s regulators.

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For more information regarding the Promontory Securities Practice Group, please contact Kathleen Hamm, Managing Director, at (202) 384-1022 or khamm@promontory.com