insider trading isn't illegal because it makes things unfair, it's illegal because it's theft - misappropriation of company info for personal benefit. if I give my golf buddy a heads up my company is acquiring AcmeCo next week and he trades on that and hands me a fat sack of cash at the bar, then that's illegal. I'm using company info to help my friend and deriving a personal benefit from it.

it's illegal because I hurt my shareholders - my buddy bought AcmeCo, which drove the price up doing so, and my company had to pay a higher price for AcmeCo as a result. it's a bit like taking the company car for a joy ride, the shareholders are fine with you having a company car, just not destroying it wrecklessly.

if my friend, on the other hand, happened to be on a train with my CEO, and he saw a note fall out of the CEO's briefcase, a note which told him AcmeCo would be acquired next week and he traded on that info, then that is fine, really. shareholders were still harmed and they might not be happy with the CEO, but nothing was stolen, no duty was breached.

to bring this back to your question - they do a couple of things to limit the perception of trading on material info for personal benefit.

• there are blackout periods around quarterly reports where people who work for the firm can't trade.
• they buy/sell in a process-oriented fashion (around the same time every year)
• they abstain from trading when there is material information being discussed, like a merger, even outside of blackout periods
• they invest for the long term by buying the actual stock and not, like, short dated out of the money call options the day before a surprise earnings announcement.

at the end of the day, the C suite of a company is going to be highly scrutinized in their trading activity to make sure they aren't doing anything funny like that, and the above is the accepted way of doing so.