Here’s something Dave shared yesterday on TheCorporateCounsel.net about an announcement by the Division of Investment Management:

The SEC’s Division of Investment Management and Division of Corporation Finance recently provided guidance regarding the federal securities implications of pooled employer plans (also known as “PEPs”), which are defined contribution retirement plans that permit multiple, unrelated employers to join together in a single plan. These types of plans can be particularly attractive for small businesses seeking to provide retirement plan benefits to employees.

In its Staff Statement Regarding Pooled Employer Plans, the Division of Investment Management provided its views regarding the applicability of the “single trust exclusion” in Section 3(c)(11) of the Investment Company Act to pooled employer plans, as well as the applicability of Securities Act Rule 180 to interests in collective investment trusts maintained by a bank and issued to those pooled employer plans that cover self-employed individuals.

In parallel, the Division of Corporation Finance updated its Corporation Finance Interpretations (CFIs) to address two interpretive issues relating to pooled employer plans. In new Securities Act Sections CFI Question 118.01, the Staff states:

Question: Are pooled employer plans (“PEPs”) eligible to claim the Section 3(a)(2) exemption for any interest or participation in a “single trust fund”?

Answer: The staff will not object if a PEP that meets the qualification requirements of ERISA and Section 401 of the Internal Revenue Code and otherwise meets the conditions of Section 3(a)(2) claims the Section 3(a)(2) exemption for any interest or participation in a “single trust fund” even though multiple, unrelated employers participate in the PEP. As with any plan that meets the exemption in Section 3(a)(2), the offers and sales of any securities in connection with the PEP are subject to the anti-fraud provisions of the Securities Act. See Section 17(c). In addition, the exclusion in Section 3(a)(2) for investments in employer securities would apply. Therefore, if a participating employer offers its own securities to its employees as an investment option in a PEP, the Section 3(a)(2) exemption would not be available for the plan interests offered to the employees of that employer. Please refer to Securities Act Forms CFI [126.45] regarding the availability of Form S-8 to register the offer and sale of an employer’s own securities and the plan interests in connection with a PEP at https://www.sec.gov/rules-regulations/staff-guidance/compliance-disclosure-interpretations/securities-act-forms. For the views of the staff of the Division of Investment Management regarding the application of section 3(c)(11) of the Investment Company Act of 1940 and rule 180 under the Securities Act to PEPs, see here.

Further, in new Securities Act Forms CFI Question 126.45, the Staff states:

Question: An employer participant in a pooled employer plan (“PEP”) offers its own securities to its employees as an investment option in the PEP, such as by offering an employer securities fund in which employee contributions may be invested. May the employer use Form S-8 to register the offers and sales of those securities? If so, must the PEP also register the offer and sale of plan interests on that form?

Answer: An employer participant in a PEP may register on Form S-8 offers and sales of its own securities to eligible employees. In addition, the PEP must register the offer and sale of plan interests to the employees of that employer on the same Form S-8. Along with the employer registrant’s signatories, the PEP’s trustees or other persons who administer the PEP must sign the Form S-8 for the plan. See Instruction 1 as to Signatures on Form S-8.

Alternatively, the staff will not object if the employer files a Form S-8 to register the offering of its securities to its employees and the PEP separately files its own Form S-8 to register plan interests offered and sold by the PEP to the employer’s employees, as long as the employer, in addition to incorporating its own periodic reports, incorporates the PEP’s periodic reports by reference into its Form S-8. If filing a separate Form S-8:

• The PEP should register an indeterminate amount of plan interests in accordance with Rule 416(c).
• The staff will not object if the PEP applies Rule 457(h)(2) by analogy and does not pay a fee for the registration of the offer and sale of the plan interests as long as the PEP includes a reference to the employer’s related Form S-8 by name and file number and provides a hyperlink to the filing.
• The PEP’s Form S-8 need only incorporate the documents related to the plan in order to comply with Item 3.
• The employer and the PEP must ensure that investors receive all of the information constituting a Section 10(a) prospectus pursuant to Rule 428 and that such information is updated in accordance with General Instruction G of Form S-8.
• The staff will not object if a PEP registers plan interests offered and sold to employees of multiple employers on a single Form S-8 as long as each employer’s separate Form S-8 is referenced and hyperlinked. [May 4, 2026]

With this guidance, the Staff has addressed some questions that have come up since Congress enacted the Setting Every Community Up for Retirement Enhancement (SECURE) Act of 2019.

– Meredith Ervine 

We now have more data on CEO pay trends from 2026 proxy disclosures — this time from ISS-Corporate. They reviewed 2026 proxy disclosures by 318 companies in the S&P 500 with no CEO turnover in the last two years. Here’s what they found:

– Median CEO pay […] stood at $17.7 million. More than 74 percent of S&P 500 CEOs in the study received a pay increase while compensation fell for the remaining 26 percent.

– For the segment of companies that increased pay for their chief executives, the median change was 15.6 percent, while compensation decreased by a median of 9.5 percent among those companies where pay dropped.

– Notably, pay increased by more than $10 million for 27 CEOs, and 21 CEOs saw their pay more than double in 2025.

– Median CEO pay increased for these large cap companies by 10.6 percent from the 2025 to 2026 filing periods, the analysis found, representing an acceleration from the 7.5 percent rise observed between the 2024 and 2025 filing periods.

While increases in base salary were modest, as is often the case, growth was primarily driven by an increase in the value of new equity awards.

– Meredith Ervine 

Compensation Advisory Partners recently analyzed how 2026 proxy disclosures on goal-setting and earned compensation addressed the impact of tariffs. They specifically surveyed 22 companies that had filed proxies by April 17 and depend on imported goods, manufacture overseas or source key materials from countries impacted by tariffs. Here are their key findings:

– Of the 22 companies reviewed, 11 (50 percent) did not reference tariffs impact on incentive plan metrics in their proxy statements.
– Of the remaining 11 companies (50 percent), 8 disclosed an impact on their annual incentive (AI) plan, while 3 disclosed impacts on both annual and long-term incentive (LTI) plan payouts.
– Therefore, 8 out of 22 companies (36 percent) made adjustments to annual and/or long-term incentive payouts.

They found that the disclosures had a consistent theme:

[P]erformance goals for both AI and LTI plans had been established prior to the implementation of tariffs. Once tariffs were introduced, companies experienced a period of volatility during ongoing negotiations between the Trump Administration and the impacted countries. As a result, many companies characterized the negative financial impact as an unforeseen, extraordinary event and applied upward adjustments to incentive plan payouts.

Not surprisingly, that was the cited rationale when adjustments were made:

[T]ariffs are external, unpredictable shocks that were not included in the original target setting process, so adjusting helps isolate true operational performance and ensures executives are evaluated and compensated based on factors within their control. Adjustments also prevent key financial metrics such as EBIT, EBITDA, Free Cash Flow, and EPS from being distorted and help maintain a consistent pay-for-performance framework.

When companies made adjustments, here’s what they observed about their disclosures:

The impacts on payouts were disclosed as adjustments to their plan payouts in percentage points. In comparing annual versus long-term incentive plan adjustments, ICU Medical was the only company to disclose a quantitative adjustment to its long-term incentive plan, applying an upward adjustment of +50% to the payout percentage. Adjustments were more common for annual incentive plans, with reported increases ranging from +6% to +43% of the actual payout. Among the seven companies that disclosed a specific adjustment, the median increase was +13%, and the average was +12% to the actual payout.

Finally, companies adjusted annual and long-term incentive plans in different ways. Of the eleven companies that made adjustments, 5 companies modified adjusted EBITDA to exclude all or a portion of the tariff expense to increase incentive plan payouts. In addition, three companies adjusted multiple performance metrics rather than a single measure.

Companies that discussed tariffs but declined to make adjustments explained that they did so for purposes of:

– Ensuring performance metrics do not fully exclude real economic impacts of tariffs on profitability
– Maintaining accountability for management’s response to tariff pressures
– Avoiding overstatement of performance by fully removing a real cost
– Preserving credibility with shareholders and consistency in reporting

CAP goes on to make some future predictions:

Companies are likely to continue adopting hybrid approaches to tariff treatment, with a growing emphasis on partial and rule-based adjustments rather than fully excluding or fully including tariff impacts. The evidence suggests companies will increasingly distinguish between anticipated tariffs, which are treated as normal economic costs, and unforeseen or newly imposed tariffs, which may be adjusted out using predefined mechanisms such as cutoff dates or specific cost factors.

This reflects an effort to balance fairness in performance evaluation with accountability for real business outcomes, while also enhancing transparency and consistency in incentive design. As tariff volatility persists, companies are expected to formalize these practices further, embedding clearer guidelines into incentive plans to ensure that performance metrics remain both economically meaningful and aligned with shareholder value creation.

Speaking of balancing fairness and accountability, they also note that companies “will need to evaluate whether and how to adjust performance metrics to exclude or normalize the impact of refunds, ensuring that executive compensation reflects underlying operating performance rather than a one-time boost.”

– Meredith Ervine 

Here’s something Mark Borges shared on his Proxy Disclosure Blog here on CompensationStandards.com on Friday:

[I]f you’re like me, you may not have noticed a pair of bills introduced in Congress in March that would empower the Federal Deposit Insurance Corporation to claw back certain compensation paid to executives and directors of financial corporations subject to the FDIC’s jurisdiction. Generally, the House bill, the “Failed Bank Executives Accountability and Consequences Act” (H.R. 7886) and the Senate bill, the “Failed Bank Executives Clawback Act of 2026” (S. 4050), would require the executives and directors of large banks (as well as certain other persons) to disgorge the compensation they received over a multi-year period (two years for the House and three years for the Senate) preceding their bank’s failure. Citing the failure of Silicon Valley Bank as an example, the measures would hold these individuals financially responsible for some of the costs those failures impose on the rest of the banking system and the U.S. economy.

The applicability of this clawback is limited, and Mark notes that, like many bills introduced, the measures’ prospects are unclear. But clawback requirements remain top of mind for some in Congress (on both sides of the aisle), and even when proposals don’t get any short-term traction, some keep coming back up again and again.

– Meredith Ervine