Forced Disclosure

New SEC rules require corporations to come clean on pay packages

STARTING NEXT YEAR, HIGHLY PAID CORPORATE EXecutives are going to have a lot of explaining to do. Under new regulations adopted by the Securities and Exchange Commission, companies will have to disclose in unprecedented detail how much their top executives earn, as well as tell stockholders how those pay packages were determined. The rules are the latest effort in a movement by stockholder groups and politicians to curb excessive pay and perks. Shareholders at 43 corporations, including IBM, Bell Atlantic and Chrysler, challenged CEO compensation this year. And at least two pay-disclosure bills have been introduced in Congress.

The new SEC...

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