The "say-on-pay" rules giving stockholders a voice in
executive compensation are now in place for publicly traded
companies. The rules establish new proxy requirements applicable to
the 2011 proxy season, although for smaller reporting companies,
implementation of certain of the rules has been deferred until
2013. A number of companies have already begun to report the
results of their "say-on-pay" votes.
Say-On-Pay" Rules
Recently, the U.S. Securities and Exchange Commission (the
"SEC") adopted final rules implementing Section 951 of
the Dodd-Frank Wall Street Reform and Consumer Protection Act (the
"Act"). These rules, commonly referred to as the
"say-on-pay rules," provide for stockholder approval of
executive compensation and, in certain circumstances, executive
"golden parachute" arrangements. Promulgated under new
Section 14A of the Securities Exchange Act of 1934, the say-on-pay
rules establish three separate, non-binding stockholder advisory
votes:
