Audit committees have many concerns to worry about, yes, but one very prosaic matter trumps all the others: that the directors themselves have enough insurance to insulate them from lawsuits.
Yes, directors all know the three basic elements of directors-and-officers insurance. So-called “Side C coverage” protects the company in the event of securities litigation; Side B coverage reimburses the company for money spent to indemnify a director or officer; and Side A coverage applies when the company can’t (or won’t) indemnify a director or officer. But that’s just the framework of coverage available to boards; applying those types of coverage to your specific company, with its specific risks and board members overseeing them, can be considerably more complicated.
