Acting SEC Chairman Michael Piwowar has called for reconsidering a controversial rule on CEO pay ratio disclosure.
The rule requiring disclosure of the ratio of a CEO's pay to that of the median employee is scheduled to take effect in 2018, beginning with 2017 pay data.
Mr. Piwowar said in a statement posted Monday on the Securities and Exchange Commission website that the rule, implemented as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act and already delayed in the face of comments received during the rulemaking process, continues to cause compliance challenges.
“Issuers are now actively engaged in the implementation and testing of systems and controls designed to collect and process the information necessary for compliance. However, it is my understanding that some issuers have begun to encounter unanticipated compliance difficulties that may hinder them in meeting the reporting deadline,” Mr. Piwowar said.
The SEC will now seek public input “on any unexpected challenges … and whether relief is needed,” over the next 45 days. Mr. Piwowar said he has also asked SEC staff “to reconsider the implementation of the rule based on any comments submitted and to determine as promptly as possible whether additional guidance or relief may be appropriate.”
