As Dealbook explains, Jamie Dimon's announcement that he has cancer has once again raised the perennial problem of when corporations should disclose health issues on the part of a senior executive.
“JPMorgan hit the right note in its disclosure,” said Gary Hewitt, the head of research at accounting and governance research firm GMI Ratings. “It’s a difficult balance between the legitimate right to privacy on the part of the executive and the legitimate right to know when critical things might happen to an executive for shareholders.”
No specific securities regulations compel companies to disclose health-related information about their executives. Experts say such rules would probably violate an individual’s right to privacy under existing health care laws. A 2009 study of disclosures of chief executive illnesses found that many executives waited to go public until they believed their illness was manageable. Other companies made the disclosure only upon the executive’s death.
Disclosure of a CEO's health problem presents very difficult questions for securities regulation. I discussed them in some length a few years ago in a post about Apple's slowness to disclose Steve Jobs' illness, which I'd encourage interested readers to review. I concluded than that:
Given the social--and even constitutional--emphasis on personal privacy, surely it would be “silly” to “require management to accuse itself of [being ill].”
That still seems about right to me.
What I'd be curious to know from any health law lawyers out there is how HIPAA factors into the disclosure analysis.
