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With proxy season under way, so is executive pay scrutiny

Joe Mont | May 15, 2018

In many ways, 2018 is shaping up to be the year of the paycheck. Across America there are fierce debates over how much various folks make at their jobs and whether that compensation is fair.

Are women paid less than men for the same work? Who should be entitled to overtime pay? Are CEOs and executives overpaid when compared to their reports? When should shareholders step in?

That last question is a cornerstone of the Dodd-Frank Act’s approach to what its crafters view as often excessive executive compensation. The 2010 legislation mandated that the Securities and Exchange Commission issue rules concerning shareholder approval of executive compensation, which it did in 2011.

The rules specify that say-on-pay votes must occur at least once every three years. Companies are also required to hold a “frequency” vote at least once every six years in order to allow shareholders to decide how often they would like to be presented with the say-on-pay vote.


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