Thursday, March 16, 2006
Director liability should be capped: PwC CEO
PricewaterhouseCoopers' chief executive said the pendulum has swung too far against company directors after a string of accounting scandals and that now the risk of legal action threatens board recruitment.
CEO Samuel DiPiazza told Reuters in a telephone interview, "(We need) some type of financial cap around their (director) liability, so that you can't put a board member in the position of losing everything he's ever worked for in his whole life because he was misled by management."
In the aftermath of scandals in the past five years at Enron, Worldcom, Global Crossing, Parmalat and others, countries have tightened corporate governance rules.
In the U.S., Sarbanes-Oxley rules hold directors accountable for internal reporting checks and balances.
posted by Brian Moran @ 10:32 AM