New SEC disclosures about risk and governance
17 Dec 2009
The US Securities and Exchange Commission has approved new rules that improve corporate disclosure regarding risk, compensation and corporate governance matters when voting decisions are made.
In particular, the new rules require disclosures in proxy and information statements about:
- The relationship of a company's compensation policies and practices to risk management.
- The background and qualifications of directors and nominees.
- Legal actions involving a company's executive officers, directors and nominees.
- The consideration of diversity in the process by which candidates for director are considered for nomination.
- Board leadership structure and the board's role in risk oversight.
- Stock and option awards to company executives and directors.
- Potential conflicts of interests of compensation consultants.
