August 23, 2016
Pay Ratio: Have You Started Doing the Math?
– Broc Romanek
After an initial flurry of questions last fall, things have really died down since the first of the year. In speaking with colleagues, I believe that most companies have yet to really begin to focus on this disclosure requirement. Given that it doesn’t apply until the 2018 proxy season, it just hasn’t been as high a priority as more pressing immediate issues. I expect that we will see a significant uptick in questions beginning this Fall – as companies turn their attention to the rule and prepare a “dry run” to ensure that they have an effective process in place prior to the end of fiscal 2017.
So far, very few companies have voluntarily disclosed pay ratios – and the handful that have used a format & approach selected by the company, not the SEC (eg. Ionis Pharma just comparing cash comp; this PayScale report just compares cash comp too). Here’s this blog from Mark Borges entitled “The Initial SEC-Compliant CEO Pay Ratio Disclosure?” You can keep track of pay ratio disclosures as they come in via this search box…
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