The NASPP Blog

Yesterday, I had the opportunity to participate in a Computershare FreeSMARTS webcast with my NASPP colleagues Danyle & Robyn on insider trading compliance policies. Preparing for this webcast gave me the perfect excuse to peruse some of the policies available on the web. Our sister site, TheCorporateCounsel.net has a fantastic list of example policies in the Insider Trading Policy practice area.

One aspect of the insider trading policy that stock plan managers might be expected to participate in is employee education and communication. I’m a big fan of quizzes to supplement standard education practices, particularly because they provide a means to gage the effectiveness of your program. Insider trading is an area that is perfect for a situational quiz–one that gives employees a situation and asks whether or not it is a case of insider trading. This type of a quiz is very much like an interactive FAQ and requiring employees to stop and actually consider their answers helps them apply the concepts to their own jobs and circumstances.

Today I want to share with you a bit of what I uncovered in the process of preparing for this presentation:

MyStockOptions.com offers a quiz on insider trading that serves as a general knowledge poll. These are questions that all of your employees should be able to answer, including the question on penalties for insider trading. It’s important for every employee to understand the potential sanctions that are the teeth behind insider trading regulations.

Smart Money recently published an intriguing article on the advantages of making insider trading legal. One of the hypothetical scenarios from this article was among the questions posed to two leading law professors in this follow-up article. The responses to some of these questions demonstrate the difficulty inherent in a vague set of regulations such as what we have with insider trading.

Finally, in reviewing some posted insider trading policies on company websites, Boeing’s FAQs really stood out to me as a stellar example of a short set of questions that clarify what actions might constitutes insider trading. If you are looking to build a quiz, questions like those provided by Boeing are a great place to start.

Of course, you don’t need to create FAQs or quizzes in-house. There are a number of service providers who specialize in HR training, including insider trading, if you have even a relatively small budget for it.

-Rachel