ASA Releases Comments on SEC's Executive Compensation Roundtable

WASHINGTON – The American Securities Association (ASA) today released comments submitted to the Securities and Exchange Commission (SEC) outlining recommendations to reform current executive compensation disclosure rules.

"ASA commends Chairman Atkins and the SEC for focusing on an issue that has been the subject of constant debate and criticism since the SEC overhauled executive compensation disclosure requirements in 2006," said ASA President and CEO Chris Iacovella. "We look forward to working with the Commission to make certain the materiality standard governs all disclosures required by public companies, and to reduce the length and complexity of executive compensation disclosure so every American investor can understand it."

Key Recommendations from ASA's Comments:

• Existing executive compensation disclosure requirements should be simplified through the adoption of a principles-based approach to executive compensation disclosure.
  

• The SEC should adopt page limitations for executive compensation disclosure.
  

• The SEC should conduct a thorough economic analysis to assess the real-world costs and benefits for investors and issuers alike, as required under the Administrative Procedure Act. 
  

• The SEC should use its statutory authority to reduce cost burdens of certain Dodd-Frank mandates and revisit the "pay ratio" and "pay versus performance" rules.
  

• The Roundtable should discuss the influence of the foreign-owned proxy advisory duopoly on executive compensation practices. Many institutional investors continue to rely on proxy advisor vote recommendations – despite the fact that both firms operate with glaring conflicts of interest, take stances on political and cultural issues, and owe no fiduciary duty to actual shareholders.

Read ASA's full submission here.

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The American Securities Association (ASA) represents the retail and institutional capital markets interests of regional financial services firms who provide Main Street businesses with access to capital and advise hardworking Americans how to create and preserve wealth. ASA’s mission is to promote trust and confidence among investors, facilitate capital formation, and support efficient and competitively balanced capital markets. This mission advances financial independence, stimulates job creation, and increases prosperity. The ASA has a geographically diverse membership of almost one hundred members that spans the Heartland, Southwest, Southeast, Atlantic, and Pacific Northwest regions of the United States.