Hardly a day goes by without an incendiary story in the press depicting the perceived excesses of executive compensation or the purported well-upholstered lifestyles of a select group of corporate executives: enormous pay and perquisite packages, problematic option dating practices, compensation committees packed with directors who owe allegiance to CEOs, unrestrained personal use by executives of corporate aircraft, stunning severance packages for supposedly failed executives and reports of "corporate kleptocracy" and other allegations of nest-feathering by executives and directors. With this onslaught of media attention, coming amid the revelation that many of these pay packages were not fully disclosed in SEC reports, it comes as no surprise that the SEC should decide to overhaul its rules related to disclosure of executive and director compensation and related-person transactions. As described by SEC Chairman Christopher Cox, the revised regulations adopted by the SEC at the end of July do not seek to judge or limit the amount that companies and their compensation committees can pay to executives. Rather, they require that all compensation be fully disclosed in a manner that is both comprehensive and comprehensible, so that shareholders can better determine whether executives are, as one business journalist phrased it, "getting superstar pay for journeyman work."
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