SEC Proposes Amendments To U.S. Compensation And Corporate Governance Disclosure

The U.S. Securities and Exchange Commission (SEC) has proposed new rules expanding compensation and corporate governance disclosure.¹ Proposed amendments to compensation disclosure include:

1. Expanding disclosure in the Compensation Discussion and Analysis (CD&A) to address how overall compensation policies for employees (including employees who are not named executive officers) create risk incentives that can affect the company's risk and the management of that risk taking;
2. Reporting the aggregate grant date fair value of stock and option awards of executives and directors, as opposed to the amount recognized for financial statement reporting purposes; and
3. Additional disclosure regarding fees paid to (and services provided by) compensation consultants and their affiliates if they also provide other services to the company.