The Securities and Exchange Commission (SEC) will hold an open meeting Wednesday to vote on new rules, including a clawback provision for executive compensation.
First proposed in 2015, the clawback rule would require stock exchanges to make clawback policies a listing requirement for issuers. Clawback policies entail companies making clear what compensation they can reclaim from executives in the event of an accounting restatement.
A number of companies have voluntarily adopted clawback policies since 2015 but the SEC would codify and extend their use.
The rule, if passed, would be the second major compensation reform this year, after the SEC earlier approved new “pay for performance” disclosures for public issuers. A rule on carbon emissions reporting is also in the works and the universal proxy card has already been voted into existence.
The SEC also plans to vote on rules applicable to tailored reports for mutual fund investors and outsourcing for investors, in what is likely to be the last rulemaking blitz before the midterm elections in November.
Earlier this month, the regulator reopened comment periods on a dozen rules due to a technical issue.
The open meeting can be joined here.