Header graphic for print
The Securities Edge Securities Blog for Middle-Market Companies

Category Archives: Disclosure Guidance

Subscribe to Disclosure Guidance RSS Feed

Pay ratio (unfortunately) coming to public company filings soon

Posted in Disclosure Guidance

After much foot dragging, I have finished reading the adopting release for the new pay ratio disclosure rules.  Yes, the release is long (300 pages or so), but adopting releases are always long.  The real reason why it took so long is that the whole concept of pay ratio disclosure just seems silly to me… Continue Reading

Pay ratio disclosure: Myths and madness

Posted in Bob's Upticks, Compensation, Corporate Governance, Disclosure Guidance, SEC

It’s done. On August 5, the SEC adopted final rules that will require publicly traded companies to disclose the ratio of the CEO’s “total compensation” to that of the “median employee.” We’re still wending our way through the massive (294 pages) adopting release, but one piece of good news (possibly the only one) is that… Continue Reading

 Summer doldrums in DC? Not so much!

Posted in Accounting, Bob's Upticks, Compensation, Disclosure Guidance, PCAOB, SEC

For those who think nothing ever gets done in Washington, last week must have been a challenge. From outward appearances, both the SEC and the PCAOB seem to be working overtime, possibly in order to ruin our holiday weekend or at least lay some guilt on us for not spending the weekend reading what they’ve… Continue Reading

The third horseman leaves the paddock

Posted in Bob's Upticks, Compensation, Disclosure Guidance

It shouldn’t come as a surprise to anyone nerdy enough to be reading this blog that the Dodd-Frank Act mandated SEC rulemaking in four areas relating to the disclosure of executive compensation: pay ratio, hedging, clawbacks, and pay-for performance. These items have been variously referred to as the “four horsemen” (as in apocalypse) or the… Continue Reading

CEO pay ratios: ineffective disclosure on steroids

Posted in Bob's Upticks, Compensation, Disclosure Guidance

On Sunday, April 12, the Business section of the New York Times led with an article by Gretchen Morgenson taking the SEC to task for not having adopted rules requiring disclosure of CEO pay ratios. This follows similar complaints by members of Congress, most recently in the form of a March letter by 58 Democratic… Continue Reading

Ineffective disclosure

Posted in Bob's Upticks, Disclosure Guidance

It’s not for nothing that I’m a securities lawyer.  I sincerely believe in the need for and efficacy of full and fair disclosure, both professionally and personally.  That’s one of the many reasons why I have been advocating disclosure reform – or, as we now call it, “effective disclosure” – to assure that important matters… Continue Reading

In sickness and in health

Posted in Bob's Upticks, Disclosure Guidance

Jamie Dimon, CEO of JPMorgan Chase, is reputed to be a decisive person with a strong personality.  Of course, that shouldn’t be news to anyone who follows business or who knows what it takes to be CEO of a major company.  So it’s interesting that he recently said that he struggled with whether JPM should… Continue Reading

Update to the JOBS Act? Probably not…

Posted in Disclosure Guidance

On January 14th, the House passed H.R. 37 “Promoting Job Creation and Reducing Small Business Burdens Act.”  Although passed with some support from the Democrats (29 votes, which in these days of hyper-partisanship is practically a bipartisan bill), the White House issued a veto threat on January 12th because the bill also delays part of… Continue Reading

Wrong turn?: Is the SEC looking to further expand its regulatory jurisdiction through the disclosure process?

Posted in Disclosure Guidance

In the wake of the recent financial crisis, the Dodd-Frank Act created the SEC Investor Advisory Committee with the stated purpose of advising the SEC on (i) regulatory priorities of the SEC; (ii) issues relating to the regulation of securities products, trading strategies, and fee structures, and the effectiveness of disclosure; (iii) initiatives to protect… Continue Reading

Despite First Amendment concerns, the conflict minerals rule is here to stay

Posted in Disclosure Guidance

A few months ago, the U.S. Court of Appeals for the D.C. Circuit upheld portions of Section 1502 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, known as the “conflicts mineral rule.” The rule, enacted by Congress in July of 2010,requires certain public companies to provide disclosures about the use of specific conflict… Continue Reading

Institutional investor organization asks the SEC to require disclosure of “golden leashes”

Posted in Disclosure Guidance

The compensation disclosure rules contained in Regulation S-K are intended to provide meaningful disclosure regarding an issuer’s executive and director compensation practices such that the investing public is provided with full and fair disclosure of material information on which to base informed investment and voting decisions. However, as we pointed out in a blog from last… Continue Reading

Institutional investor organization asks the SEC to require disclosure of "golden leashes"

Posted in Disclosure Guidance

The compensation disclosure rules contained in Regulation S-K are intended to provide meaningful disclosure regarding an issuer’s executive and director compensation practices such that the investing public is provided with full and fair disclosure of material information on which to base informed investment and voting decisions. However, as we pointed out in a blog from last… Continue Reading

4th and 108, SEC elects to punt on Regulation S-K disclosure reform

Posted in Disclosure Guidance

Section 108 of the Jump Start Our Business Startups Actrequired the SEC to undertake a study of the disclosure requirements of Regulation S-K. Specifically, the statute mandated that the SEC shall: conduct a review of its Regulation S-K to— comprehensively analyze the current registration requirements of such regulation; and determine how such requirements can be… Continue Reading

Government mandated pay ratio disclosure will fail to achieve its intended objectives

Posted in Disclosure Guidance

Compensation of public company executives re-emerged back into the public limelight after the recent financial crisis which began in late 2007. The public perception was one of outrage in large part due to the fact that many investors in public companies were experiencing significant losses in their investment portfolios while CEOs and other executives were… Continue Reading

Hurricanes, flash freezes and other disasters – plan and disclose accordingly or you may be hearing from the SEC

Posted in Disclosure Guidance

Almost 10 months since Superstorm Sandy caused widespread destruction to the northeastern U.S., an area not known for frequent hurricane activity, the people and businesses affected have still not fully recovered. As we now reenter the peak of hurricane season, businesses along the eastern seaboard are probably taking a closer look now than in years… Continue Reading

Time to throw XBRL in the trash bin?

Posted in Disclosure Guidance

It has been four years since XBRL became a four letter word to issuers and nearly eight years since the SEC introduced the concept to issuers, yet XBRL hasn’t fulfilled the SEC’s prediction of XBRL increasing the “speed, accuracy and usability of financial disclosure.”  Largely, the reason for the failed prediction is that many potential… Continue Reading

New SEC Chair: Mary Jo White

Posted in Disclosure Guidance

The mission of the U.S. Securities and Exchange Commission (“SEC”) is to protect investors, maintain fair, orderly, and efficient markets, and facilitate capital formation. This sounds great, but how does the SEC actually carry out its mission? The answer lies in the SEC’s oversight and regulation function of the key participants in the securities world,… Continue Reading

Recent meeting between the Society of Corporate Secretaries and Governance Professionals and SEC Staff provides insight

Posted in Disclosure Guidance

On Tuesday, the Securities Law Committee of the Society of Corporate Secretaries and Governance Professionals met with officials from the Divisions of Corporation Finance, Investment Management, and Trading and Markets and the Office of the Whistleblower.  While neither new Chair Mary Jo White (confirmed in April) nor new Director of Corporation Finance Keith Higgins (starts… Continue Reading

Are new Iran-related disclosure requirements turning public companies into tattletales?

Posted in Disclosure Guidance

In other breaking news that many may have missed, Orbitz Worldwide, Inc. recently reported in its most recent 10-Q that a handful of employees of a Hilton-branded hotel were paid wages via direct deposit into bank accounts maintained with Bank Melli. The obvious question is why is Orbitz reporting on seemingly immaterial activities of a… Continue Reading

Social media as a disclosure channel – slow but steady

Posted in Disclosure Guidance

Public companies are beginning to cautiously adopt social media as a disclosure channel. This area has experienced substantial changes lately as the SEC moved from a posture of threatening action against Netflix’s CEO for a post he made on his personal Facebook page to adopting a more relaxed and expansive position. This was really just… Continue Reading

SEC relaxes restrictions on social media postings (but Regulation FD still applies)

Posted in Disclosure Guidance

The SEC tiptoed into the twenty-first century as the agency validated the use of social media sites in certain situations for disclosure of information by publicly traded companies. This social media disclosure is subject to some constraints, but it is a positive move for public companies, shareholders and potential investors who are social media users. … Continue Reading

Cybersecurity legislation continues to move forward

Posted in Disclosure Guidance

Senator Jay Rockefeller (D., West Virginia), the most vocal proponent of cybersecurity legislation, has renewed his focus on cybersecurity legislation. He has sponsored previous cybersecurity-related legislation, but has been unable to implement any meaningful legislation in this area. His prior sponsorship of the proposed Cybersecurity Act of 2012 initially seemed to draw support in the… Continue Reading

Securities Law 101 (Part III): Watch your mouth! Regulation FD’s impact on (selective) disclosure

Posted in Disclosure Guidance

This is the third part of our Securities Law 101 series.  Because capital raising is such a critical function for middle market companies, we designed this series to introduce their management teams to some of the fundamental concepts in securities law.  We hope that this series will prevent some of the most common mistakes management… Continue Reading

Proposed campaign contribution disclosure rules may be coming as early as April (but not likely)

Posted in Disclosure Guidance

As first reported by Professors  Lucian Bebchuk and Robert J. Jackson, Jr. in their recent posting on the Harvard Law School Forum on Corporate Governance and Financial Regulation, the SEC may take action to issue proposed rules on corporate political spending disclosures by public companies as early as the second quarter of this year. This… Continue Reading