Insight's August 2023 issue features our Viewpoint, "Demonstrating Pay and Performance Alignment: A Comparison of Compensation Actually Paid and Realizable Pay", by Ira Kay, Mike Kesner, Linda Pappas and Ed Sim.
The pay versus performance (PVP) disclosure requirement from the Dodd-Frank Act of 2010 evolved from the belief of a limited relationship between executive pay and shareholder performance which, in turn, had become a significant corporate governance issue. This belief was documented by the Securities Exchange Commission (SEC) in the PVP final rule, which cited the legislative history of the new disclosure requirement:
…the relationship between executive pay and performance has become a ‘significant concern of shareholders,’ and that the required disclosure should ‘add to corporate responsibility,’ as registrants will be required to provide clearer executive pay disclosures.
To subscribe to this newsletter, click here.