Securities Law Commons^™

Out Of The Shadows: Requiring Strategic Management Disclosure, Nadelle Grossman

West Virginia Law Review

Under federal securities laws and regulations, public companies must disclose to investors a considerable amount of information about their risk management processes to limit losses. In contrast, these companies need not disclose virtually anything about their strategic management processes to gen- erate gains. This mismatch in disclosure gives investors a distorted sense of firm processes to create value, undermining the federal securities laws' central purpose of creating informed investors. It also signals that risk management processes, which are cast in disclosure sunlight, are more important to firm success than strategic management processes, which remain in the shadows. To address these …