Client Alert: Reconsideration of Pay Ratio Rule Implementation

Capital Markets Client Alerts

The Trump administration has made it no secret that it intends to loosen the regulation of publicly-traded companies. One such regulation that many expected to be on the chopping block is the “pay ratio disclosure rule” or Section 953(b) of the Dodd-Frank Act. The pay ratio disclosure rule requires a public company to disclose the ratio of the median of the annual total compensation of all employees to the annual total compensation of the company’s CEO.

On February 6, 2017, the acting Chairman of the SEC announced that he is seeking public input on any “unexpected challenges that issuers have experienced as they prepare for compliance” with the pay ratio disclosure rule. The public has 45 days to submit their comments. It appears that the stage is set for repeal of this regulation, as Chairman Piwowar goes on to note that the SEC staff will be reconsidering the implementation of the pay ratio disclosure rule altogether.

Read the statement here: