Tag: pay ratio rules

Fallout from pay-ratio reporting

As a general matter, SEC rules do not mandate companies to disclose details about the composition or location of their workforces; Reg S-K requires disclosure of only the number of employees, but no information about them. And the vast majority of companies provide little detail voluntarily. But now, as this article in the WSJ reports, companies are beginning to disclose more information about their workforces overseas, and the impetus for that disclosure is the new pay-ratio rule—all at a time when issues of overseas versus domestic employment are especially fraught. 

Corp Fin issues interpretive guidance on the calculation of pay-ratio disclosure

Yesterday, Corp Fin issued new Guidance on Calculation of Pay Ratio Disclosure regarding the use of statistical sampling in connection with the pay-ratio disclosure requirement, which mandates public company disclosure of specified pay-ratio information, beginning with the upcoming 2018 proxy season. The new guidance provides a fairly expansive reading of the use of reasonable estimates, statistical sampling and other reasonable methods. But prepare yourself, it also uses terms such as “multimodal,” “gamma distribution” and, my favorite, “lognormal,” surely all firsts for this PubCo blog. (Wikipedia defines a “lognormal”distribution as “a continuous probability distribution of a random variable whose logarithm is normally distributed.” Does that help?)  Whether or not you are mystified by some of the terminology (as am I), it is clear that the leitmotif (take that, statisticians) of the new guidance is that you can use or combine any number of different methodologies and estimates so long as they are all reasonable and appropriate under your particular facts and circumstances.

In her final speech as SEC Chair, White identifies current trends assailing SEC independence

by Cydney Posner Mary Jo White took the occasion of her final speech as SEC Chair, presented to the Economic Club of New York, to discuss how to maintain the role of the SEC as an effective financial regulator and how the SEC can “continue as a strong independent agency […]

CEO-employee pay ratios may not be as bad as feared, says Mercer study

by Cydney Posner There’s been a lot of hand-wringing about what the data will show when public companies are finally required, in 2018, to disclose their CEO-to-median-employee pay ratios as required by new SEC rules implementing Dodd-Frank (discussed in this Cooley Alert).  Not to worry! Those ratios promise to be […]

Does disclosure of a high CEO-employee pay ratio affect consumer behavior?

by Cydney Posner The answer is yes, according to a recent study from the Harvard Business School,  “Paying Up for Fair Pay: Consumers Prefer Firms with Lower CEO-to-Worker Pay Ratios.  Just in time to be part of the mood music for the SEC’s expected adoption of final pay-ratio rules on […]

SEC sets meeting to vote on final pay-ratio rules

by Cydney Posner As widely rumored, the SEC will consider  final adoption of  the Dodd-Frank pay-ratio rules on August 5.

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 […]

Republicans to SEC Chair: delay pay ratio rules. Is a repeal attempt in the offing?

by Cydney Posner The WSJ reports that three Republican congressman — House Financial Services Committee Chairman Jeb Hensarling, and Reps. Scott Garrett  and Bill Huizenga —  have written to SEC Chair Mary Jo White urging that the SEC stop spending time on the pay-ratio disclosure rules and prioritize completing rulemaking […]