Bloomberg BNA’s Corporate Law & Accountability Report is available on the Corporate Law Resource Center. This news service keeps corporate practitioners informed of legal developments of...
Dec. 17 — Senate Democrats want the SEC to finish its rule that would require public companies to disclose the ratio of their chief executive's compensation compared to their other employees'.
Sen. Robert Menendez (D-N.J.), who pushed for the disclosure to be part of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and 14 other members of the Democratic caucus signed a Dec. 16 letter to Securities and Exchange Commission Chairman Mary Jo White asking for swift action on the proposed rule.
“In particular, we ask for your commitment to bring this rule before the Commission for a vote before the end of the first quarter of 2015,” the letter states. The signers included Sens. Jack Reed (D-R.I.), Elizabeth Warren (D-Mass.) and Dick Durbin (D-Ill.).
White said she had hoped to finalize the rule by the end of 2014, but that is looking increasingly unlikely.
Several influential House Republicans wrote the SEC in November asking for the rule to be delayed in favor of other initiatives.
Dodd-Frank § 953(b) requires the SEC to write a rule mandating that companies disclose “the median of the annual total compensation of all employees of the issuer, except the chief executive officer,” along with the CEO's pay and the ratio of the two.
“Pay ratio disclosure helps investors evaluate the relative value a CEO creates, which facilitates better checks and balances against insiders paying themselves runaway compensation,” the letter states. “When a company’s performance improves but only the CEO is rewarded, for example, investors should know, so they can ask what kinds of incentives this creates for the company’s future performance.”
The proposed rule received more than 128,000 public comments after it was proposed in September 2013.
“The fact that the simplest of all the 400 Dodd-Frank rules remains delayed typifies the political indecision of the SEC chair,” Bartlett Naylor, a financial policy advocate at Public Citizen, told Bloomberg BNA.
To contact the reporter on this story: Rob Tricchinelli in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Phyllis Diamond at email@example.com
The letter is available at http://www.menendez.senate.gov/download/?id=0221B510-93B9-40D3-B8E0-E8E34B43AEB9.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)