The U.S. Securities and Exchange Commission (SEC) has issued a long-awaited final rule that significantly expands executive pay disclosures by publicly traded U.S. companies. The new disclosures, which will provide detailed information about the performance metrics companies use to determine executive compensation payouts, are effective for the 2023 proxy season.
The final rule was issued on Aug. 25 along with a fact sheet summarizing its provisions.
The rule implements requirements under 2010’s Dodd-Frank Wall Street Reform and Consumer Protection Act. The SEC first proposed a pay-versus-performance disclosure rule in 2015 and reopened the comment period on the proposal in January of this year.
