Review of SEC’s Pay Ratio Rule Rankles Democratic Senators

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By Rob Tricchinelli

Several Democratic senators knocked an SEC decision to again solicit comments on an agency rule that requires companies to disclose how much their chief executives make compared to rank-and-file employees.

“I am concerned by your decision to further delay implementation of this rule, especially because you seem to be seeking one-sided comments from issuers,” Sen. Tammy Baldwin (D-Wis.) wrote in a letter to the Securities and Exchange Commission’s acting chairman Michael Piwowar.

A separate letter was sent by Sens. Chris Van Hollen (D-Md.), Jack Reed (D-R.I.), Elizabeth Warren (D-Mass.), Cory Booker (D-N.J.), Richard Durbin (D-Ill.), Jeff Merkley (D-Ore.), Al Franken (D-Minn.) and Bernie Sanders (I-Vt.).

“For nearly seven years, investors have been waiting for this disclosure, and now as the first reporting period has just begun, you have inexplicably halted this important investor tool,” they wrote.

Reopened in Feburary

A spokesman for Piwowar declined to comment.

Earlier this year, Piwowar requested comments on “any unexpected challenges that issuers have experienced as they prepare for compliance with the rule and whether relief is needed.”

The rule was adopted in August 2015 and is set to take effect in 2018 for 2017 compensation ratios. The additional commentary wouldn’t undo the rule but could set the stage for future changes.

“It is my understanding that some issuers have begun to encounter unanticipated compliance difficulties that may hinder them in meeting the reporting deadline,” Piwowar said at the time.

To contact the reporter on this story: Rob Tricchinelli in Washington at

To contact the editors responsible for this story: Phyllis Diamond at; Seth Stern at

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