"This financial crisis had many significant causes, but executive compensation practices were a contributing factor," said Treasury Secretary Tim Geithner in a statement.
From CNNMoney.com: White House proposes new pay legislation
The Obama administration moved forward Wednesday on curbing runaway corporate pay practices, proposing new legislation aimed at giving shareholders a greater voice on executive pay and appointing a new so-called "pay czar."
The White House's two-part proposal would require non-binding annual "say-on pay" shareholder votes for all public companies and attempt to create a firewall between those board members responsible for setting executive pay packages and senior management.
Compensation reform experts have long lobbied for such changes, arguing that shareholders have no influence in the matter and that executive pay practices have become tainted by relationships between management and company directors.
The new legislation, which will require Congressional approval, would be effectively carried out by broadening the powers of the Securities and Exchange Commission.
Putting a cap on or restricting pay? Isn't the United States based on Capitalism? Is regulating pay going to hinder drive and motivation for reaching for the top? Let us hear what you think.
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