SEC Rules to Expose Highest Executive Pay Can Be Easily Gamed

When the U.S. adopted a new rule last week forcing companies to show how much more top executives earn than workers, regulators noted there’s leeway. Academics and activists have spent the time since then figuring out how boards might game the system.

The 294-page pay ratio rule “provides companies with substantial flexibility,” while remaining true to the 2010 Dodd-Frank Act that mandated its creation, Securities and Exchange Commission Chairman Mary Jo White said Aug 5.