Public companies required to report more details on pay and perks

Standard

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:

  • Salary
  • Bonus
  • 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.