Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Tuesday, January 29, 2008

SEC Criticizes Disclosure on Executive Pay Policies

As the SEC has increased its scrutiny of how corporations describe their executive compensation policies, it has expressed dissatisfaction at how many companies describe the role of individual performance in pay decisions.  In the past year the SEC sent out two rounds of letters to corporations about their descriptions of their pay policies.  Letters from 26 completed cases are posted on the SEC website.  The Wall St. Journal suggests this could lead corporations to focus less on individual performance as a measure of success and instead focus on corporate financial targets like earnings and stock prices.  WSJ, SEC Unhappy With Answers on Executive Pay.

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