Wilson Sonsini’s Insider Trading Policies: A Survey of the SV150 provides an in-depth analysis of the insider trading policies filed by Silicon Valley’s largest public companies. The report examines several key elements of these policies including persons subject to the policy, quarterly blackout periods, pre-clearance requirements, gifts, and restricted activities including hedging, pledging, and margin accounts.

Highlights include:

• A substantial majority (88 percent) of insider trading policies expand beyond directors, officers, and employees, to also cover other service providers such as contractors, consultants, and agents.
• Most of the insider trading policies cover family members (97 percent) and controlled entities (94 percent), although the specific application of policies to these groups can be nuanced.
• Most of the insider trading policies (86 percent) provide for quarterly blackout periods that commence between two to four weeks before the fiscal quarter-end, with two weeks being the most prevalent timing (48 percent) across the SV150.
• At least in part due to the amendment to Exchange Act Rule 16a-3 requiring that dispositions of gifts be reported within two business days on a Form 4, most of the insider trading policies (90 percent) include limitations on making gifts when in possession of material nonpublic information or during blackout periods, while only four percent of policies provide that dispositions of gifts are an exception to the policy.
• A significant minority of insider trading policies (43 percent) allow pledging of company shares but require pre-clearance prior to pledging those shares and/or only allow pledging by certain company insiders.

Read the full report.