Today the [tag]Securities and Exchange Commission[/tag] ([tag]SEC[/tag]) voted to require public companies to report the details of pay and perks for executives. The new rule will take effect in 2007, and is aimed at making total [tag]executive compensation[/tag] clearer.
The details companies will be required to provide about the executive compensation include:
- Dollar value of stock options
- Changes in the value of pension benefits
- Above-market earnings on deferred compensation
- All perks exceeding $10,000 per year
- Golden parachutes and other benefits paid to executives who are fired or released pursuant to a merger
These disclosures will be required for a company’s top five executives, including the CEO and CFO. The disclosures must be made in “plain English” so that investors can understand the items.