SEC Adopts Final Say-on-Pay and Golden Parachute Rules
On January 25, 2011, in a 3-2 vote, the SEC adopted final rules implementing the provisions of the Dodd-Frank Act that require U.S. public companies to conduct separate shareholder advisory votes on (i) executive pay (say-on-pay), (ii) frequency of the executive pay vote and (iii) executive compensation in connection with M&A transactions that is presented for shareholder approval (say-on-golden parachutes). While the final rules substantially reflect the proposed rules, there are a several changes that are worth noting. The say-on-pay and frequency vote rules will become effective 60 days after publication in the Federal Register, while say-on-golden parachute disclosure and voting requirements will become effective for filings after April 25, 2011.
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