Public Companies

With internal controls and enhanced financial disclosure at the centre of compliance efforts to date, it’s easy to forget that the regulatory burden extends far beyond accounting rules.

A few examples:

• Under Bill 198’s secondary market liability regime, defendants can only escape liability by proving the exercise of due diligence in conducting a reasonable investigation into company disclosures
• MI 52-109 will require CEOs and CFOs to personally certify that they have designed and implemented “disclosure controls and procedures”
• Under National Instrument 58-101, reporting issuers that adopt a written code of ethics must disclose how the board monitors compliance with the company code of ethics

With Section 404 of the Sarbanes-Oxley Act of 2002 at the center of compliance efforts to date, it’s easy to forget that the regulatory burden extends far beyond accounting rules.

A few examples:

• Section 302 of SOX requires CEOs and CFOs to personally certify that they have established and maintain “disclosure controls and procedures”
• The NYSE Listed Company Manual requires an annual certification by CEOs that they are not aware of any violation of the exchange’s corporate governance listing standards
• The U.S. Federal Sentencing Guidelines mandate the establishment, monitoring and company-wide exposure of an “effective compliance and ethics program”

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