Executive Compensation Disclosure Peek Ahead

In a speech yesterday to the Council of Institutional Investors, Mary Schapiro, the SEC Chairman, made some noteworthy comments concerning executive compensation disclosure. In remarks concerning the role of the SEC in ensuring that “timely and reliable information” is available to the markets, she made the following points:

• certain expert panels have concluded that “compensation schemes [are among the] primary driving forces” of the current “turmoil”
  
  
• an area of disclosure that “may need further consideration” is “whether our compensation disclosures accomplish the objective of providing shareholders with the most relevant information,” and particularly whether “shareholders fully understand how compensation structures and practices drive an executive’s risk-taking”
  
  
• the SEC “will consider whether greater disclosure is needed about a company’s overall compensation approach, beyond decisions with respect only to the highest paid officers, as well as compensation consultant conflicts of interest”

The full text of the speech is available by clicking here. 

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