Detroit Free Press: Sudip Datta on health disclosures for CEOs
At the end of a marathon day in Balocco, Italy, in June, Sergio Marchionne was still going strong. Marchionne, the CEO of Fiat Chrysler Automobiles, died less than two months later. In the days after his death, the Swiss hospital where he died said Marchionne had been treated over the previous year for an undisclosed serious illness, and questions were being raised about what company officials knew. But if the FCA board knew of Marchionne's struggles — and that's not a certainty — is there a requirement to share more? Despite leading Fiat Chrysler to a position of relative financial strength after its darkest days and his outsized role in modern automotive history, Marchionne's health, like that of other CEOs, could remain a secret so long as it did not affect his ability to do the job, according to experts. U.S. securities law requires companies to disclose information considered materially relevant, but does not mandate the release of information related to CEO health. Despite the very public lives led by many CEOs and the significant amount of information companies willingly release, CEO health is often not a topic shared openly with the public. Professor Sudip Datta, finance department chair at Wayne State University's Mike Ilitch School of Business, said the issue goes to privacy. "There's no requirement per se about disclosing the health of the CEO to investors," Datta said, "Just because someone is a CEO, it doesn't mean someone checks all his privacy at the door." The U.S. Securities and Exchange Commission "doesn’t say you have to disclose the private lives of the CEO or for that matter any employee," Datta said.