The Securities and Exchange Commission on Thursday voted to require companies to disclose how well top management’s pay tracked with corporate performance over several years, the culmination of a long-delayed effort by the U.S. securities regulator.
The new rule puts into practice a provision required by the 2010 Dodd-Frank Act to discourage financial fraud and better align executive compensation with corporate results. The SEC initially proposed the rule in 2015 under a previous chair, Mary Jo White. In January, under Chair Gary Gensler, it sought additional public feedback on the proposal.
