Category: Executive Compensation
SEC proposes clawback rules
by Cydney Posner At an open meeting this morning, the SEC voted, three to two, to propose rules implementing Section 954 of Dodd-Frank, the clawback provision. Both Commissioners Gallagher and Piwowar voted against the proposal. As you may recall, Section 954 required the SEC to direct the national securities exchanges […]
Delaware Chancery Court applies entire fairness standard of review to director compensation
by Cydney Posner What is the judicial standard of review applicable to an award of compensation by directors to directors under an equity incentive compensation plan that has been approved by the shareholders? That was the question before the Delaware Chancery Court in Calma v. Templeton. The answer is, as always: […]
More than half of poll respondents plan to disclose “more than the minimum” under pay-versus-performance rules
by Cydney Posner A poll conducted by compensation consultant Towers Watson in the course of its webcast on the SEC’s proposed pay-versus-performance disclosure rules revealed that, if the rules are adopted, more than half of the respondents expect to disclose “more than the minimum” required under the SEC proposal and […]
Executive compensation — a trigger for hedge fund activism?
by Cydney Posner Is executive pay becoming a hot button issue for activist hedge funds? While executive pay has long been under scrutiny from standard-issue corporate governance activists, such as union pension funds, the interest of some hedge fund activists in executive compensation issues has the potential to introduce a […]
No such thing as too much analysis
by Cydney Posner Or, at least, that seems to be the position of the SEC staff following the tongue–lashing it suffered in 2011, when the D.C. Circuit tossed out the SEC’s mandatory proxy access rules. (See these news briefs.) You may recall that plaintiffs Chamber of Commerce and Business Roundtable had […]
SEC on the verge of proposal to implement Dodd-Frank clawback provision
by Cydney Posner The WSJ is reporting that the SEC is on the verge (July 1) of proposing clawback rules designed to implement Section 954 of Dodd-Frank, “recovery of erroneously awarded compensation.” Of course, actual implementation could still be a long way off, as the proposal would be subject to […]
CooleyAlert: “SEC Proposes New Rules on Pay Versus Performance”
by Cydney Posner See our CooleyAlert on the SEC’s proposed new pay-versus-performance rules. It’s called “SEC Proposes New Rules on Pay Versus Performance: When “Compensation Actually Paid” is Not Compensation Actually Paid and “Company Financial Performance” May be Unrelated to Company Financial Performance.” It’s mighty fine reading!
With two dissents, SEC proposes pay-for-performance disclosure rules
by Cydney Posner This morning, by a three to two margin, the SEC voted to propose rules requiring companies to disclose executive pay for performance. The proposal comes five years after passage of Dodd-Frank, which imposed the obligation on the SEC. Currently, many companies voluntarily provide information that could fit […]
Efforts to reform executive compensation follow the law of unintended consequences
by Cydney Posner Remember how “say on pay” was supposed to put the lid on soaring executive pay? And just how has that turned out? According to a study conducted by ISS affiliates, (reported in Compliance Week ) the average compensation package for CEOs in the U.S. rose nearly 13 […]
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