Compensation Consultants Are Focus of SEC Proposal

By Staff Report

Mar. 31, 2011

Publicly traded companies would have to disclose whether their compensation consultant’s work raises any conflict of interest under proposed rules approved March 30 by the SEC.

Under the proposal, companies would also have to disclose the nature of the conflict and how it is being addressed.

The proposed rules, adopted in a 5-0 vote, are required under a provision in the Dodd-Frank Wall Street Reform and Consumer Protection Act.

Under the proposed rules, the New York Stock Exchange and other U.S. securities exchanges would have to adopt listing standards that would require each member of a company’s board of directors’ compensation committee to be independent. Factors to be considered for independence include whether the company pays any compensation or fee to a director or whether a director is affiliated with a company, a subsidiary or affiliate.

Also, compensation committees would have sole discretion in retaining a compensation consultant as well as have direct responsibility for paying and overseeing that consultant. The standards would require companies to pay for their committees’ use of compensation consultants.

Public comments on the proposed rules are due April 29.  

Filed by Barry B. Burr of Pensions & Investments, a sister publication of Workforce Management. To comment, email


Stay informed and connected. Get human resources news and HR features via Workforce Management’s Twitter feed or RSS feeds for mobile devices and news readers.


blog workforce

We build robust scheduling & attendance software for businesses with 500+ frontline workers. With custom BI reporting and demand-driven scheduling, we help our customers reduce labor spend and increase profitability across their business. It's as simple as that.

Book a call
See the software

Related Articles

workforce blog


California fast food workers bill: why it’s more than meets the eye and how to prepare

Summary: California signs bill establishing a “fast food council” that has the power to raise the indus...

workforce blog


Minimum Wage by State in 2022 – All You Need to Know

Summary The federal minimum wage rate is $7.25, but the rate is higher in 30 states, along with Washing...

federal law, minimum wage, pay rates, state law, wage law compliance

workforce blog


Supreme Court blocks vaccine mandate for large businesses, upholds for healthcare facilities

Summary Supreme Court blocks vaccine-or-test mandate for 100+ staff businesses Vaccine mandate for Medi...

compliance, COVID-19, Healthcare, mandate, OSHA, U.S. Supreme Court, vaccination