SEC proposes ‘clawback’ rule re: unreasonable comp

BVWireIssue #155-4
August 26, 2015

The SEC has issued a proposed rule designed to ensure that executives do not receive “excess compensation” if the financial results on which previous awards of compensation were based are subsequently restated because of material noncompliance with financial reporting requirements. The proposed rule would implement a mandate in the Dodd-Frank Act that requires the SEC to adopt rules directing the national securities exchanges and national securities associations to prohibit the listing of any security of an issuer that has not adopted a written policy providing for the recovery of incentive-based compensation (IBC) under certain circumstances.

Public comments: The SEC is requesting comments on 101 questions related to the proposal. Comments are due by September 14.

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