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 of financial performance of the company. The purpose of the rule, according to the SEC, is to elicit disclosure to provide greater transparency and allow shareholders to be better informed when they vote to elect directors and in connection with advisory votes on executive compensation. The proposed rule would implement Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”). Our analysis of the rule is here.