Under Dem Pressure SEC Forces CEO “Pay Gap” Disclosures


The SEC bent under increasing demands from Democrats, like Massachusetts Senator Elizabeth Warren and unions such as the AFL-CIO, who support the rule.

The measure was hidden in the 2010 Dodd-Frank law amid outcry over alleged disparity over compensation for chief executives and average employees. Time.com reports

“Pay ratio disclosure should provide a valuable piece of information to investors,” said Democratic Commissioner Kara Stein said.

Republicans and trade groups like the U.S. Chamber of Commerce have fought back against the measure at every turn, saying it will be too expensive, could mislead investors and is not material to a company’s financial statements.

The Chamber has urged the SEC to defer working on the rule at all, and it called for permitting companies to disclose the ratio in an addendum instead of formal filings in order to reduce their liability. Read the report here.

Heather Slavin Corzo, a director at the AFL-CIO, said she was pleased that the SEC completed the rule but remained concerned about “weaknesses that could lead to loopholes,”

Those loopholes probably also prevent the AFL-CIO from having to offer what its officers are paid. And Congress people like Elizabeth Warren should also have to disclose the gap between her lowest dreg workers and her total income levels. It would only be fair.

Photo: Edward Kimmel on Flickr



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