Originally published February 13 2006
SEC to propose sweeping changes in top execs' pay
by Mike Adams, the Health Ranger, NaturalNews Editor
The Securities and Exchange Commission is attempting to overhaul executive pay disclosure. SEC officials say the changes would require corporate proxy statements to provide the total annual compensation for each of the five highest-paid executives.
The Securities and Exchange Commission, responding to rising criticism of soaring -- and partially hidden -- executive pay, is poised to propose the most sweeping overhaul of pay disclosure rules in 14 years, seeking to push companies to divulge much more about their top executives' perquisites, retirement benefits and total compensation.
The proposed changes, according to SEC officials, would for the first time require corporate proxy statements to provide a column with a total annual compensation figure for each of a company's five highest-paid executives and be far more specific about the value of their various benefits.
These and other proposed changes will be presented at a public SEC meeting on Jan. 17, where commissioners will question staff members and vote whether to proceed with the plan.
While it's too early to tell how the SEC will vote on the proposals -- and details of the plan could be altered in the coming week -- Christopher Cox, the agency's new chairman, appears to have the commissioners' support.
Even professional investors gripe that with deferred compensation, stock options and executive perks such as personal use of corporate aircraft, they have a hard time figuring out what executives are being paid.
One lingering concern for business groups is whether a total compensation number is a fair number since the inclusion of the value of options, which can't immediately be cashed in, may make the annual payment seem artificially high.
"We want to make sure it's done fairly so it satisfies the shareholders and others who want more useful information and at the same time doesn't unnecessarily compromise strategic plans or product developments that may be tied to compensation incentives," Mr. Lehner said.
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