Glossary

Corporate Governance

What is corporate governance? 

Corporate governance involves the processes, policies, guidelines and standards set by corporations to reference when managing and making formal decisions. Plus, it is a factor in helping a company avoid risk. There are seven characteristics of corporate governance often referenced: Discipline, transparency, independence, accountability, responsibility, fairness and social responsibility.

Corporate governance is also an important topic to include in shareholder communications. For example, risk management, diversity and human capital management are corporate governance topics frequently addressed in proxy statements. Additionally, shareholders remain keenly interested in corporate boardroom diversity, for reasons of both equity and performance. Including visuals such as iconography, infographics and pie charts can help represent the company’s position on these topics within the proxy. For support and additional information, explore our Annual Meeting and Proxy Solutions.

Corporate Sustainability Report

What is a Corporate Sustainability Report?

A Corporate Sustainability Report (CSR) is a report published by companies to show their environmental and social responsibility and their results. Overall, it is a way to show internal and external stakeholders the company’s commitment to sustainability. For support and additional information, explore our Annual Meeting and Proxy Solutions.

COSO 2013 (Committee of Sponsoring Organizations of the Treadway Commission)

What is COSO 2013 (Committee of Sponsoring Organizations of the Treadway Commission)?

The COSO (Committee of Sponsoring Organizations of the Treadway Commission) created a framework that companies can adopt to monitor and evaluate their internal controls. The COSO framework includes: Control environment, risk assessment, control activities, information and communication and monitoring. For support and additional information, explore our automated SOX compliance solution.

Divestiture

What is a divestiture?

Divestitures involve the sale, closure or exchange of a business unit or portion of the business. Spin-offs often focus on separating business units with high growth potential. Divestitures help a company focus on its core business or expertise.

Divestitures can occur after a merger or acquisition. This allows a company to eliminate parts of the business that do not fit its strategic interests. Divestitures can be advantageous for reducing costs, generating capital and increasing strategic focus.

Divestiture is the act of shedding certain business interests. For example, General Electric shed its pharmaceutical business in 2020. Similarly, WeWork shed its software interests and refocused solely on its workspace-sharing business. For support and additional information, explore our Capital Markets solutions.

Dodd-Frank Act

What is the Dodd-Frank Act?

The Dodd-Frank Act of 2010, also known as the Dodd-Frank Wall Street Reform and Consumer Protection Act, comprises 2,000 pages of federal rules and regulations for financial institutions and their customers. Named after its Democratic sponsors, U.S. Senator Christopher J. Dodd and U.S. Representative Barney Frank, Dodd-Frank was passed in July of 2010 as a means of preventing the events that triggered the 2008 financial crisis from happening again.

The largest financial regulation revamp of its kind since the Great Depression, Dodd-Frank led to the creation of a number of new government bodies, including a Consumer Financial Protection Bureau (CFPB), to protect retail customers from predatory mortgage lending and reduce incentives for mortgage brokers to get home buyers to take on more costly loans. The CFPB now requires loan terms to be communicated in an easy-to-understand, simplified format.

Dodd-Frank has also spawned the Financial Stability Oversight Council, charged with keeping an eye out for potential threats to the financial system. It also created the Orderly Liquidation Authority, which was established to facilitate the liquidation or restructuring of a large financial company that’s close to failing, and thereby preventing a far-reaching economic collapse. The Dodd-Frank Act also makes it mandatory for companies active in the oil, gas and minerals industries, that file forms annual reports with the SEC, to report all payments made to governments on Form SD. For support and additional information, explore our SEC reporting solutions.

EDGAR

What is EDGAR (Electronic Data Gathering, Analysis and Retrieval)?

EDGAR (Electronic Data Gathering, Analysis, and Retrieval) is the automated, online system the SEC provides for the receipt, acceptance, review and dissemination of documents submitted in electronic format from the SEC. The EDGAR site is free to the public for searching and viewing corporate regulatory filings on the web or via File Transfer Protocol (FTP).

The SEC implemented EDGAR to improve efficiency and transparency around corporate filings. All publicly traded companies use EDGAR to submit required, time-sensitive documents to the SEC.

Documents that must be filed via EDGAR include annual and quarterly statements, tender offers, information regarding institutional investors’ holdings, Schedule 13D and other key filings, many of which are the most important to investors and analysts. Except in the case of investment companies, actual annual reports to shareholders don’t need to be submitted on EDGAR, although some companies do so voluntarily.

Filers must submit various official EDGAR filings in Interactive Data format, using Inline XBRL (iXBRL). EDGAR was phased into use over a three-year period ending May 6, 1996. Consequently, filings from that date and earlier may not be included in the system due to a hardship exemption made for hardcopy paper filings. For support and additional information, explore our SEC reporting solutions.

Environmental, Social and Governance (ESG)

What is environmental, social and governance (ESG)?

ESG or Environmental, Social and Governance are the three key standards used by vendors to evaluate a company’s corporate responsibility and can affect their reputation with investors. Environmental initiatives are examined based on a company’s impact and steps toward improving the environment. Social is examined by how companies build and maintain relationships within the organization or company, and externally with communities. Governance initiatives are evaluated by investors by examining a company’s leadership and its internal operations. For support and additional information on ESG, explore our solutions for Annual Meeting and Proxy Solutions.

ESMA (European Standards Market Authority)

What is European Standards Market Authority (ESMA)?

ESMA, the European Securities and Markets Authority, was formed in January 2011, and is a European Union financial regulatory agency and European Supervisory Authority, located in Paris.

ESMA works in the field of securities legislation and regulation to improve the functioning of financial markets in Europe, strengthening investor protection and cooperation between national competent authorities.

The idea behind ESMA is to establish an “EU-wide financial markets watchdog.”

As an example of regulations handed down by ESMA, beginning Jan. 1, 2021, they implemented the European Single Electronic Format (ESEF) mandate which defines Inline XBRL (iXBRL) as the reporting standard for issuers. For support and additional information, explore our ESEF reporting solutions.

Evidence of Coverage (EOC)

The Evidence of Coverage is a document delivered by a health plan to its members each year, for Medicare Advantage or Part D plans. The EOC provides comprehensive plan details for the plan year such as benefits information, out of pocket costs, a member’s rights and responsibilities and tips on a plan’s operations including how to file for an appeal. The EOC also provides contact information for regulatory and state departments, as well as contact information for the plan’s customer service and other internal areas. For support and additional information, explore our solutions for Health Plans Regulated Communications.

Explanation of Benefits (EOB)

What is an Explanation of Benefits (EOB)? 

An EOB, or Explanation of Benefits, is a statement from a health insurance plan detailing the charges received for your services. The EOB statement is generated when your provider submits a claim to the health insurance plan for services you received. The EOB describes the costs the health insurance plan will pay for medical  services, prescription drugs and products you’ve received, the patient’s out-of-pocket costs including amounts falling to deductibles or co-payments, and amounts the plan forgives for using an in-network provider with negotiated rates. The EOB is not a bill, rather it is a statement of charges that were received and processed by the insurer. For support and additional information, explore our solutions for Health Plans Regulated Communications.