On June 20, 2012, the Securities and Exchange Commission (SEC) adopted SEC Rule 10C-1 as required by the Dodd-Frank Act of 2010. The rule initially was proposed by the SEC on March 30, 2011. Our previous discussion of the proposed rule can be found in this WSGR Alert.
The rule directs the New York Stock Exchange, the NASDAQ Stock Market, and other national securities exchanges to establish listing standards that:
- define standards of independence applicable to compensation committee members and directors who oversee executive compensation matters outside of the structure of a formal board committee;
- require each member of a listed issuer's compensation committee to be an independent member of the board of directors;
- require consideration of specified factors by a listed issuer's compensation committee relating to the independence of any compensation advisers; and
- specify the authority and responsibilities of the compensation committee over the appointment, compensation, and oversight of the work of any compensation adviser.
The SEC also amended the proxy disclosure rules of Regulation S-K to require new disclosures about the services provided by compensation advisers and conflicts of interest.
Please see full alert below for more information.
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