The SEC adopted two rules on Wednesday, Oct. 26, including one aimed at ensuring that publicly traded companies reclaim incentive-based compensation that was erroneously awarded to executives.
The commission also adopted a rule requiring more transparency around mutual fund information shared with investors and proposed a rule that would require investment advisers to exercise due diligence if they outsource certain functions that serve their clients.
Under the new rules, listed companies must file written compensation recovery policies along with their annual reports, the SEC said.
The clawback rules come amid a broader push by the SEC for more transparency and disclosures in financial reports. A public comment period will remain open for 60 days, or for 30 days after the date of publication in the Federal Register, whichever period is longer. Learn more.