This profile is the latest in a series of weekly conversations with executives at U.S. public companies who are currently involved in establishing and developing compliance programs. An index of previous conversations is available here.

What’s your role at Schering-Plough?

I’m corporate secretary. I also head up securities law, corporate governance, corporate finance, treasury, and employee benefits and compensation, in terms of providing legal advice in those areas. I’m also named in the proxy as the corporate governance coordinator for all shareholder inquiries about any governance or social issues to the board and management.

Give us more detail about the governance part of your job. How is that function staffed?

We don’t have a lot of problems, thankfully. We have a lot of ongoing dialogue with shareholders, and our new management team is very committed to transparency. It’s pretty easy to be the governance person in that sort of environment.

We have a chief compliance officer here, who is a senior executive and direct-report to the CEO. He, the CFO and I serve on a Sarbanes-Oxley steering committee, for example, that oversees the Section 404 plans and works from a corporate perspective. Other Sarbanes requirements fall under various people’s responsibilities. For example, the expedited reporting of insider stock transactions falls under my responsibility; the processing of any kind of tip-line activity that relates to accounting or audit is handled by corporate audit and my office jointly. Different kinds of whistleblowers that would also be picked up under Section 16 fall under the compliance officer.

How challenging was it for Schering-Plough to manage Sarbanes-Oxley compliance in that first year of 2004?

Schering got a new CEO in April 2003, and he brought the compliance officer on board within that first year of duties. And our compliance officer is a direct-report to the CEO, which I think is a fantastic model and still somewhat unusual in today’s world. Together our executive team instilled a new corporate culture with a focus on greater business integrity and compliance, so that was already in progress by the time Section 404 rolled out and it really fit almost seamlessly within that effort.

I think many of the things we’re doing to show compliance with Section 404, we would have done perhaps with a little different implementation or different testing, but many of the activities would have been the same anyway.

You’re also the new chairman of the Society for Corporate Secretaries and Governance Professionals. What are your goals for your tenure?

One of my first tasks as chair is to look at our own governance structure and services provided to members, and make sure we are providing the best we can give to all the different kinds of members who are involved in corporate governance from any perspective—of course, never losing sight of our core members, who are corporate secretaries.

But the society added the “Governance Professionals” part to its name just this year. You think they deserve a higher profile, no?

Well, we realized that many of our members were sometimes corporate secretaries and sometimes not, but had equal amounts of expertise in governance and provided equal strength to the society. Just looking at my own career, for example, right now I am a corporate secretary. I have been a governance officer but not corporate secretary, I’ve been head securities lawyer but not corporate secretary, and I’ve been counsel to the CFO in one job where he was the corporate secretary—so I’ve been a corporate governance professional in many of the different jobs you’d see if you looked from a 360 degree look.

We wanted to make sure that everyone doing governance, and who would benefit from membership in the society, felt equally welcome and that we were thinking of ways to integrate everybody’s perspective and needs. We think that’s the best way to serve all our members.

Speaking of your varied career history—where do good corporate governance officers come from?

That’s a great question. I think to be a good governance officer, you must have a firm grasp of accounting for public companies, of securities law requirements, of stock-exchange listing requirements, and also be very in touch with the views of investors. If you’re in-house, you need to look at your own investor group: if it’s largely institutional, you need to be talking with the governance professionals at those institutions, and if it’s retail investors I think it’s very helpful to have focus groups and investor fairs so you know what your own particular group of investors are interested in.

When I was at a law firm, one thing I did was to help clients learn how to solicit those views from their investors. Here at Schering-Plough, for example, we have an invitation in the proxy statement that if anyone from the shareholder group has questions about the company, they should call. The invitation lists a number for investor relations if they have financial questions, and my office if they have governance sorts of questions.

That sounds like a lot to master.

It takes a lot of effort, certainly. It takes a fair amount of time, but I personally don’t think you can discharge the duties of a governance officer well if you don’t understand, for the particular company you’re involved with, what drives the stock price, what is important to the company’s performance, what’s on the mind of investors, and what’s the strategic vision of management and the board. You really need to overlay all those things when you assess a particular issue or give advice about a decision.

Now, you can draw pieces of that information from others. If you know you don’t understand what drives a company’s stock performance, you might team up with the investor-relations professionals. If you don’t understand SEC accounting, you’d certainly need someone on your team who is part of the company’s process for doing that reporting.

Do we have a shortage of talented governance officers right now?

I think there’s plenty of talent out there. One benefit of the Society is that it gives people with those backgrounds a chance to network with each other; I was recommended for my job from a fellow society member.

I also am very committed to developing young lawyers. In fact, I just hired two excellent lawyers directly from the SEC’s Division of Corporate Finance, who are corporate governance officers-in-training, if you will. They have strong backgrounds and right sort of skill sets you need, and are now working in-house and developing the other pieces of the corporate governance professional’s skills.

So you ultimately see chief governance officers as on par with chief financial or information officers, sitting in a company’s inner sanctum?

Oh, absolutely. That’s already happening, I think. Peggy Foran is the chief governance officer at Pfizer and former chairman of this Society, and she was invited onto the MONY board. [MONY Group Inc. was acquired by AXA Financial Inc in 2004.] It was very good foresight on that board’s part, recognizing that knowledge in the governance area, like knowledge in auditing, accounting, marketing or strategic thinking, is an important wealth of knowledge that the company needs.

Thanks, Susan.

Compliance Week regularly profiles corporate executives responsible for governance, compliance, ethics and risk. Click here for recent Q&As. If you would like to be considered for a future Q&A, or if you would like to nominate a public company executive for a Q&A, please email Matt Kelly.

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