*UPDATED* SEC Wants Pay and Performance Data Linked with XBRL
The US Securities and Exchange Commission continues to seek to leverage interactive data for greater transparency. This week the body proposed rules to require companies to disclose the relationship between executive compensation and the financial performance of a company using XBRL.
The goal is to provide greater transparency and allow shareholders to be better informed when they vote to elect directors and in connection with advisory votes on executive compensation. Read the press release.
*UPDATE – 13 May 2015*
The proposed rule has been published in the Federal Register and we have additional details. The rule requires “registrants to disclose in a clear manner the relationship between executive compensation actually paid and the financial performance of the registrant” (excepting emerging growth companies or foreign private issuers). There would also be a phase in period for smaller companies covering three filing periods.
Disclosure using XBRL tags would be required, and is being recommended because “shareholders may be interested in extracting and analyzing the information in the table across large numbers of registrants or, eventually, a large number of years, and would thus benefit from the proposed tagging requirement”.
The Commission is seeking specific comments on the use of XBRL, including tagging methods and benefits to stakeholders. The rule may be accessed here and the deadline for comments is 6 July.
