SEC

On October 26, 2022, the Securities and Exchange Commission (the “SEC”) adopted a long-awaited rule that will require listed companies to adopt and publicly file so-called “clawback” policies.  As we discuss in more detail in this alert, the rule requires listed companies to adopt clawback policies to recover, reasonably

Continue Reading Executive Compensation Implications of SEC’s Final Rule on Clawback Policies

On Wednesday, April 18th, the SEC introduced a much-anticipated package of proposed rules and formal guidance concerning the standards of conduct for financial professionals. The more than 1,000-page proposal, which emerged eight years after Congress required the agency to conduct a study on the topic, addresses whether investment advisers and
Continue Reading SEC Proposal Dives Into Long-Standing Debate About the Duties of Investment Professionals

On August 5, 2015, the Securities and Exchange Commission adopted, by a three-to-two vote, a rule that will require most public companies to disclose, annually, the ratio of the median of the annual total compensation of the company’s employees to the annual total compensation of the company’s principal executive officer.
Continue Reading SEC’s New Pay Ratio Disclosure Rule Explained

The Securities and Exchange Commission has proposed a rule that will require companies with listed securities to recover incentive compensation based on erroneous financial statements. The proposed rule will also require new disclosures concerning listed companies’ clawback policies and their efforts to recover incentive compensation pursuant to the policies. The proposed rule and a fact sheet are available on the SEC’s website.
Continue Reading SEC Proposes Clawback Rule

By David Engvall, Reid Hooper, Keir Gumbs, and David Martin

On April 29, 2015, the Securities and Exchange Commission (the “SEC”) proposed a new rule that would require public companies to provide new disclosures annually regarding the relationship, over a five-year period, between executive compensation actually paid and a measure
Continue Reading SEC Proposes “Pay for Performance” Disclosure Rule

On February 9, 2015 the SEC proposed rules, as required by Section 955 of Dodd-Frank, that would require disclosure regarding whether directors, officers and other employees are permitted to hedge or offset any decrease in the market value of equity securities granted by the company as compensation or held, directly or indirectly, by employees or directors.  The purpose of the rules, according to the SEC, is to elicit disclosure regarding whether employees or directors are permitted to engage in transactions that mitigate or avoid the incentive alignment associated with equity ownership.  Companies may wish to review their trading policies in light of the proposed rules.
Continue Reading SEC Hedging Disclosure Proposal Could Cause Companies To Review Trading Policies

The Securities and Exchange Commission (SEC) recently approved changes to the listing standards of the New York Stock Exchange (NYSE) and NASDAQ relating to the independence of compensation committee members and the responsibilities of compensation committees when selecting compensation consultants, legal counsel, and other advisers. The final listing standards are substantially the same as those proposed by the exchanges, but there are a couple of noteworthy changes.
Continue Reading SEC Approves NYSE and NASDAQ Independence Standards for Compensation Committees

Institutional Shareholder Services Inc. (“ISS”) and Glass Lewis & Co., LLC (“Glass Lewis”) recently updated their proxy voting guidelines for the 2013 proxy season.  The complete 2013 Updates to ISS’s U.S. Corporate Governance Policy are available here.  Key updates from both proxy advisors relating to executive compensation and compensation-related matters are discussed below.  While the 2013 policy updates represent incremental rather than wholesale changes to the respective advisor’s voting guidelines, they also reflect, at least in part, responses to critiques of their pay-for-performance analyses voiced during the 2012 proxy season.  Public companies are urged to take the 2013 policy updates into account when reviewing existing practices and policies and considering changes. 
Continue Reading ISS and Glass Lewis Release 2013 Policy Updates

Last June, GM offered 44,000 retirees the option of converting their on-going pension benefits into a lump sum payment.  Yesterday, GM announced in a filing with the SEC that 30 percent of its retirees accepted the lump-sum offer.  As we previously discussed in this blog, GM’s offer was made in
Continue Reading What Happens When You Offer Retirees Lump Sums? GM Announces a 30% Take-Rate