New York Times (July 14)
“The median compensation of chief executives at 200 of the nation’s biggest public companies came in at $15.1 million last year, a 16 percent jump from 2011…. The pay packages — including salary, bonus, benefits, stock and option grants — ranged from $96.2 million at Oracle to $11.1 million at General Motors.” Until the SEC determines rules for Dodd-Frank disclosure requirements, however, we won’t know just how excessive these packages are. Corporations should disclose pay gap information so investors, consumers, economists and others can monitor the ratio of C.E.O. pay to regular employee pay, which by some estimates now stands at between 200 and 300 to 1 in the U.S.“The median compensation of chief executives at 200 of the nation’s biggest public companies came in at $15.1 million last year, a 16 percent jump from 2011…. The pay packages — including salary, bonus, benefits, stock and option grants — ranged from $96.2 million at Oracle to $11.1 million at General Motors.” Until the SEC determines rules for Dodd-Frank disclosure requirements, however, we won’t know just how excessive these packages are. Corporations should disclose pay gap information so investors, consumers, economists and others can monitor the ratio of C.E.O. pay to regular employee pay, which by some estimates now stands at between 200 and 300 to 1 in the U.S.
Tags: Benefits, Bonus, Compensation, Disclosure, Dodd-Frank, Executive, General Motors, Options, Oracle, Pay gap, Requirements, Salary, SEC
New York Times (July 11)
“With two bad rules adopted on Wednesday, the Securities and Exchange Commission has all but invited hucksters, rip-off artists and other bad actors to prey on individual investors. The new rules are another disturbing sign that under the leadership of the new chairwoman, Mary Jo White, the S.E.C. will pursue deregulation at the expense of investor protection.”
Wall Street Journal (December 4)
“The U.S. Securities and Exchange Commission’s high-profile attack on the Chinese affiliates of five major accounting firms calls into question the future of China-based companies listing on the U.S. stock exchanges at a time when accounting scandals have eroded investor appetite for these companies.” If the Judge rules for the SEC, the audit firms “could be suspended from seeking new U.S.-traded clients, or even blocked entirely from auditing U.S.-traded companies.”
Tags: Accounting scandals, Audit firms, China, SEC, U.S.
Wall Street Journal (October 2)
Reform of money market funds seemed to grind to a halt last month when a draft rule was blocked by the Securities Exchange Commission. Now Commissioner Gallagher is indicating that “he favors giving investors accurate prices in real time.” That would provide Chairman Mary Schapiro with the votes she need. Rather than fight this reform, “the industry would be wise to work with Mr. Gallagher and Ms. Schapiro on a floating net-asset-value before it suffers a worse fate.”
Reform of money market funds seemed to grind to a halt last month when a draft rule was blocked by the Securities Exchange Commission. Now Commissioner Gallagher is indicating that “he favors giving investors accurate prices in real time.” That would provide Chairman Mary Schapiro with the votes she need. Rather than fight this reform, “the industry would be wise to work with Mr. Gallagher and Ms. Schapiro on a floating net-asset-value before it suffers a worse fate.”
USA Today (September 26)
The SEC should curtail high-frequency trading, which breeds insanity. Traditional investors act “based on a belief that a company will prosper and that its price will rise, or… on the opposite belief.” High-frequency traders do not care “a whit about a stock’s fundamentals” they simply “buy and sell individual stocks multiple times in a fraction of a second, all in search of micro-profits with each trade.” This increases the risk of yet another flash crash. “These practices undermine the core purpose of markets, which is to raise capital in pursuit of enterprise, profit and economic growth.” The SEC should “slap a small transaction tax on rapid trades, impeding the practice and returning markets to their core purpose…. The only people harmed would be those now putting everyone else at risk.”
CFO.com (September Issue)
U.S. commitment to global accounting-standard convergence has been called into doubt. The final staff report of the Securities and Exchange Commission (SEC) ”expresses hesitation about merging international standards and U.S. GAAP.” The 137-page report, which has yet to be approved by the SEC, “made it clear that putting the IASB in the driver’s seat would be out of the question.” The report surprised some “financial reporting mavens who expected the SEC staff to move further toward convergence.” Instead, that goal is now “a little more remote.”
U.S. commitment to global accounting-standard convergence has been called into doubt. The final staff report of the Securities and Exchange Commission (SEC) ”expresses hesitation about merging international standards and U.S. GAAP.” The 137-page report, which has yet to be approved by the SEC, “made it clear that putting the IASB in the driver’s seat would be out of the question.” The report surprised some “financial reporting mavens who expected the SEC staff to move further toward convergence.” Instead, that goal is now “a little more remote.”
Tags: Accounting, Convergence, IASB, IFRS, SEC, U.S., U.S. GAAP
Financial Times (August 23)
The SEC’s decision on conflict minerals and disclosure of payments to host governments “was long overdue” and “Despite the grumbling, most companies will benefit from a cleaner industry. The SEC has contributed to that. The EU must follow suit with equally comprehensive rules.”
Tags: Conflict minerals, EU, Payment disclosure, Rules, SEC
Wall Street Journal (July 6)
On August 22, the SEC is expected to vote on conflict minerals. A new regulation could require companies to verify and report the origins of even trace amounts of tin, tungsten, tantalum or gold. Costs could be staggering. “To comply with the law, companies will have to disclose if any of the minerals that make up the metals in their products were mined in the Congo. That means every company must trace every product back through the supply chain, and then have the findings certified by an independent third party.”
Tags: Conflict minerals, Gold, SEC, Supply chain, Tantalum, The Congo, Tin, Tungsten
Traders Magazine (June Issue)
In the U.S., “the Securities and Exchange Commission is unlikely to take action anytime soon on two of the most important outstanding rule proposals effecting the options industry.” Struggling under the weight of rulemaking for Dodd-Frank, the regulator is “is not even close to ruling on” flash orders and exchange fee caps.
Tags: Dodd-Frank, Exchange fee caps, Flash orders, SEC
Financial Times (October 4)
The Securities and Exchange Commission (SEC) released its findings on the May 6 Flash Crash when the Dow Jones Industrial Average dropped 1,000 points before bouncing back…all in a breathtaking 20 minutes. The cause was an institutional investor’s $4.1 billion sale of so-called “e-mini” futures contracts to hedge against an equity position. The trade appears to have been legitimate. The SEC must take action to ensure legitimate trades don’t result in excess volatility that scares investors away from stock markets. Measures should include circuit breakers and regulation of high-frequency traders, including requirements that they serve as market makers.
Tags: Circuit breakers, Dow Jones, Flash crash, SEC, Traders
