SEC Proposes New Rules for Shareholder Advisory Votes on Executive Compensation

Cooley Alert

Shareholder "say on pay" has long been touted as a key tool for reining in runaway executive compensation. As a result of the recent Dodd-Frank Wall Street Reform and Consumer Protection Act, we will now be able to test the efficacy of that tool. Under Dodd-Frank, issuers will be required to include in their proxy statements separate shareholder advisory votes on say on pay and frequency of say on pay. These new votes are required for proxy statements that relate to annual meetings of shareholders occurring on or after January 21, 2011, whether or not the SEC has adopted implementing rules. Just barely in time to have its own say on how these matters should appear in proxy statements, the SEC has proposed new rules regarding proxy disclosure of say-on-pay proposals and the frequency of those proposals, as well as new rules regarding shareholder advisory votes on, and related disclosure concerning, golden parachute compensation arrangements, also required under Dodd-Frank.

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Related Contacts
Fred Muto  Senior Counsel San Diego
Kenneth Guernsey  Partner San Francisco, Palo Alto
Cydney Posner  Special Counsel San Francisco
Eric Jensen  Partner Palo Alto, San Francisco
Sam Livermore  Senior Counsel San Francisco
Tom Reicher  Senior Counsel San Francisco
Thomas Welk  Senior Counsel San Diego
Darren DeStefano  Partner Reston
Nancy Wojtas  Senior Counsel Palo Alto
Francis Wheeler  Partner Colorado
Amy M. Wood  Partner San Diego
Miguel J. Vega  Partner Boston
Brent Siler  Senior Counsel Washington, DC, Reston
Related Practices & Industries

Compensation & Benefits  Public Companies