On May 11, 2018, the Securities and Exchange Commission’s Division of Corporate Finance (the “Division”) released new Compliance and Disclosure Interpretations (“C&DIs”) comprising the Division’s new interpretations of the proxy rules and Schedules 14A and 14C. The new C&DIs replace interpretations previously published in the Division’s Proxy Rules and Schedule
Proxy Disclosure
SEC Adopts Additional Guidance on CEO Pay Ratio Rule
By Colleen Hart, Charles Lee, Joshua Miller & Katrine Magas on
On September 21, 2017, the Securities and Exchange Commission (the “SEC”) adopted interpretive guidance regarding Item 402(u) of Regulation S-K, which governs pay ratio disclosure. The interpretive guidance is intended to provide assistance to companies choosing to use statistical sampling in determining their median employee. In the interpretive guidance, the…
Looking Ahead to the 2018 Proxy Season: Preparing for CEO Pay Ratio Rules Disclosure Requirements
By Colleen Hart, Charles Lee, Joshua Miller & Katrine Magas on
As part of the Dodd-Frank Wall Street Reform and Consumer Protection Act enacted in July 2010, Congress directed the Securities and Exchange Commission (SEC) to adopt pay ratio disclosure requiring public companies to disclose the ratio between the annual total compensation of the median employee and the company’s principal executive officer (PEO), generally the company’s chief executive officer (CEO). The Pay Ratio rules required the SEC to amend Item 402 of Regulations S-K, related to company compensation disclosures. Item 402(u) requires companies to disclose:
- the median of the annual total compensation of all employees of the company (excluding the company’s PEO);
- the annual total compensation of the company’s PEO; and
- the ratio of the two amounts.
Proposed Clawback Rules Released
By Colleen Hart & Joshua Miller on
The SEC recently released proposed rules to adopt the incentive-based compensation clawback provisions under Section 954 of The Dodd-Frank Wall Street Reform and Consumer Protection Act, nearly five years after the Dodd-Frank Act became law.