Blog
Executive Compensation Provisions in Dodd-Frank: Part 14
Conclusion One final suggestion is an alternative to clawbacks, namely, “holdbacks,” which are a pre-payout recovery mechanism. More or less, a holdback approach requires the executive’s incentive compensation award to be mandatorily credited to a deferred...
Executive Compensation Provisions in Dodd-Frank: Part 13
Recommendations for SEC Rules on Executive Clawback Provisions It is my recommendation that past incentive-based compensations be exempt from the Recovery Policy required in §954 of the Dodd-Frank Act if the awards occur before the effective date of the SEC's final...
Executive Compensation Provisions in Dodd-Frank: Part 12
Section 954(b) Disclosure and Adoption of Mandatory Recoupment Policies 954 (b) also requires, by rule, that publicly traded companies disclose the issuer’s policy on incentive-based compensation. This requirement attaches, specifically, in the event the issuer is...
Executive Compensation Provisions in Dodd-Frank: Part 11
Clawbacks: Recovery of Erroneously Awarded Compensation The countless scandals and crises of our financial system have revealed several flaws in our compensatory system for top executives that leave many wondering how is it possible for top leaders of a company to...
Executive Compensation Provisions in Dodd-Frank: Part 10
Executive Compensation at Financial Institutions One of the more interesting provisions in the realm of executive compensation is the disclosure and prohibition of “risky” incentive-based compensation. Section 956 mandates that Federal regulators must (1) require...
Executive Compensation Provisions in Dodd-Frank: Part 9
Broker Discretionary Voting The “voting” theme within Dodd-Frank’s executive compensation provisions continues with §957: Broker Discretionary Voting. The advent of this section effectively eliminates the practice of broker’s voting on behalf of the actual owner’s of...
Executive Compensation Provisions in Dodd-Frank: Part 8
Curbing the “Golden Parachute” Under Dodd-Frank One attempt to curb incentive conflicts has been the “golden parachute” This device allows for pre-set compensation amounts if/when the manager leaves the corporation. The concept behind this device was that, because...
Executive Compensation Provisions in Dodd-Frank: Part 7
Section 951: Shareholder Vote on Executive Compensation Disclosures The other major executive compensation provision within the Act is Section 951: Shareholder Vote on Executive Compensation Disclosures. The major premise behind this is section is that no less...
Executive Compensation Provisions in Dodd-Frank: Part 6
Legislative Intent Behind Dodd-Frank Section 953 While, on its face, this section may seem to add be a noble measure of transparency to a corporate world filled with executive excess and greed, in actuality, this measure is misplaced and ineffective. That is to say,...
Executive Compensation Provisions in Dodd-Frank: Part 5
Disclosure for Disclosure’s Sake: Sections 951 & 953; Clear Disclosure, “Say on Pay” and “Say on Golden Parachutes” Among the numerous executive compensation provisions in the Dodd-Frank Act is a subset of provisions that are thematically correlated via the...