NACD Audit Committee Chair Advisory Council: Effective Practices for Internal Investigations Led by the Board
In brief: Internal investigations can result in serious legal, financial, and reputational risks to the company, in addition to significant financial and other resource costs. In spring, 2018, the NACD, KPMG LLP’s Audit Committee Institute, and Sidley Austin LLP convened a meeting of audit committee chairs of Fortune 500 companies to discuss effective practices for conducting board-driven investigations. Five significant insights emerged from the discussion:
- Early decisions have far-reaching impacts.
- Keep the external auditor informed while maintaining privilege.
- Take a proactive approach to remediation.
- Get ahead of reputational damage.
- Discuss whether the circumstances warrant self-reporting.
Most relevant audiences: Audit committee members, lead directors, board chairs, general counsel