|  | | 2006 News and Press Releases | | |
HEADLINE NEWS:
Enhanced Rating System Developed To Help Predict Securities Class Action Lawsuit Risk; The Corporate Library's New Screen Detects The Most Likely -- And Least Likely -- Public Companies To Face A Securities Class Action
Staff Writer
Market Wire. November 29, 2006
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EXCERPT: Using a series of newly-developed screens that draw upon governance and performance data, The Corporate Library today released its report identifying the 75 most likely -- and 50 least likely -- public companies to face a Securities Class Action (SCA) lawsuit within the next 18 months. The new analysis identifies six key factors which, in combination with performance fundamentals such as share price volatility and leverage, provide a reliable tool for assessing the probability of SCAs. The key factors are: -- Excessive CEO compensation -- Director age, tenure, over-commitment, and lack of independence -- Institutional owners -- Industry-specific risk -- Company size -- Share trading volume This latest study, a follow up to The Corporate Library's previous class action studies published in April 2005 and July 2006, examines more closely the probability of occurrence of SCAs. Suggestions for reducing the risks are also provided. |
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