Corporate Governance

The SEC Strikes Again: Commission Seeks Comments on Dodd-Frank Act?s Shareholder Approval of Executive Compensation

By Jim Hodgson

Earlier this week, the SEC released proposed rules designed to implement the executive compensation provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act.  The proposed rules will empower shareholders to cast advisory votes on both executive compensation and so-called ?golden parachute? payments for departing executives in change-of-control situations.

According to the SEC?s press release found here, the proposed rules will require public companies that are subject to the federal proxy rules to:  (i) provide their shareholders with an advisory vote on executive compensation and on the desired frequency of these votes; (ii) provide shareholders with an advisory vote on golden parachute compensation arrangements and understandings in connection with merger transactions; and (iii) provide additional disclosure of golden parachute arrangements in merger proxy statements.

By visiting the SEC?s website via the link provided above, investors can access the rule releases that will amend the Securities Exchange Act of 1934 and the Investment Company Act of 1940.  The Commission is seeking public comment on the proposed new rules between now and November 18.

Full post as published by PomTalk on October 21, 2010 (boomark / email).