Horwich Quoted on Executive Illness Disclosures in Light of Fiat CEO Death
Partner Allan Horwich was quoted on the challenges companies face in deciding when and how much information should be disclosed to shareholders regarding an executive’s health.
Shortly before the recent death of Fiat Chrysler CEO Sergio Marchionne, the company abruptly announced Marchionne’s departure and replacement, referring to complications suffered from a medical procedure, and said it had no prior knowledge about the CEO’s health.
Allan noted that when addressing disclosure regarding executive health it is difficult to decide whether an executive’s health is material.
At the same time, companies can get into trouble if they issue half-truths or inconsistent statements.
Allan said, “If a company were to say ‘We’ve got a marvelous executive team in place,’ but the company knows the CEO is on medical leave, the argument could be made that that’s misleading.”
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