Date: March 23, 2017

Issue: Corporate Governance;


Filing Type: Letter

Description: Of the many misguided corporate governance provisions included within Dodd-Frank, the CEO pay ratio disclosure rule stands out for its audacity.
Until Congress is able to repeal this misguided mandate, the Chamber makes
the following recommendations to the SEC in order to lessen the burden the rule
imposes upon the capital markets and main street investors:

  • The SEC should exclude all non-U.S. employees as well as seasonal and part time employees from the median employee calculation or, at a minimum,allow the foreign data privacy exemption and the de minimis exemption tooperate independently of each other,;
  • The SEC should create a safe harbor to allow issuers the option of using industry median compensation data compiled by the Bureau of Labor Statistics;
  • The SEC should rely on and adopt prevailing standards regarding the definition of independent contractors;
  • The SEC should exclude employees who are on a leave of absence or have been furloughed from the median employee calculation and;
  • In light of “pay ratio tax” proposals cropping up in various jurisdictions across the country,the SEC should conduct a new cost-benefit analysis of the pay ratio rule that takes into account the costs such taxes would impose upon issuers, investors, and the capital markets

Download PDF