Securities Regulation Daily Wrap Up, EXECUTIVE COMPENSATION—SEC proposed rules aim to streamline requirements while continuing to provide needed data, (Nov 13, 2026)

By Rebecca E. Hoffman, J.D.

The proposal would generally focus reporting on two executive officers and raise the aggregate perquisites reporting threshold to $150,000 for each named executive officer.

The SEC Nov. 13 proposed executive and director compensation disclosure changes, which would amend Item 402 of Regulation S-K, reducing the number of named executive officers and consolidating the required primary executive compensation tables (Executive Compensation Disclosure Reform, Release Nos. 33-11455; 34-106873).

Three new tables would cover granted compensation, earned compensation, and equity-award status. Comments will remain open for 60 days following publication of the proposed rule in the Federal Register.

The proposal follows an SEC review that included a public comment request and a roundtable with public companies, investors, and other experts. The framework last underwent comprehensive reform in 2006. The SEC says it seeks to reduce compliance burdens while preserving material information.

“These proposed modernizations aim to provide registrants with greater flexibility to tailor disclosures to their compensation programs, while ensuring that investors receive the information most relevant to their investment and voting decisions,” Commissioner Mark T. Uyeda said in a statement.

Officers and tables. The covered officer group typically includes five or more people. Named executive officers under the proposed rules would cut that down to those who served as principal executive officer or principal financial officer during the last completed fiscal year—two officers in most circumstances.

The three new tables and accompanying narratives would replace the four current primary tables, including the Summary Compensation Table. The Granted Compensation Table would show the compensation opportunity granted in each covered fiscal year. It would capture salary, non-equity awards including cash bonuses, and equity awards granted to a named executive officer in that year, typically at target value.

The Earned Compensation Table would show material compensation outcomes, including salary, non-equity and equity awards, retirement contributions, perquisites, and other miscellaneous compensation. Stock awards would count as earned when vested; option awards would count when exercised. The table would include value earned on equity awards granted in prior years.

The Status of Equity Awards Table would connect grants and outcomes on an award-by-award basis. It would track each equity award from its first appearance in the Granted Compensation Table until after it appears as earned in the Earned Compensation Table or has otherwise fully expired.

Perks and narratives. The minimum aggregate perquisites reporting threshold would rise from $10,000 to $150,000 for each named executive officer. An individual perquisite qualifying as a de minimis fringe benefit under Section 132(a)(4) of the Internal Revenue Code could be excluded from the aggregate calculation and would not need to be tracked.

Revised guidance would give registrants discretion to determine whether a benefit is integrally and directly related to an executive's duties, provided the determination is reasonable and made in good faith. The SEC would remove current perks examples, including security at an executive's personal residence or during personal travel.

Registrants subject to Compensation Discussion and Analysis (CD&A) would address three topics, replacing the current list of 15 example topics. CD&A would explain compensation-program objectives in relation to corporate strategy, the material elements of compensation, and how those amounts are determined.

The third topic would address, if applicable, whether the registrant considered the most recent say-on-pay vote—a shareholder vote on executive compensation—in determining compensation policies and decisions and, if so, how that consideration affected those policies and decisions.

Dodd-Frank disclosures. The SEC says it aims to simplify disclosures under the Dodd-Frank Act while maintaining material information. SEC chair Paul S. Atkins identified golden parachutes, pay-versus-performance, pay ratio, and clawbacks as congressionally mandated disclosures. He described his regulatory philosophy as “prescribing the minimum effective dose of regulation.”

For pay-versus-performance, the Earned Compensation Table total would replace the specialized Compensation Actually Paid measure and its calculations. Required performance disclosure would be limited to the registrant's cumulative total shareholder return. Reporting would cover three years instead of five and only the principal executive officer and principal financial officer.

The proposal would reduce certain disclosures about applying clawback recovery policies and remove both error-correction check boxes from the cover pages of Forms 10-K, 20-F, and 40-F. The underlying mechanics of a registrant's clawback process would remain unchanged.

For pay ratio, the fact sheet describes the current median-employee population as including U.S. and non-U.S. full-time, part-time, seasonal, and temporary employees of the registrant and consolidated subsidiaries. The proposal would limit that population to U.S. full-time employees, excluding seasonal and temporary employees, and require identification every five years rather than three. Annual total compensation for the principal executive officer and median employee would use Granted Compensation Table information or methodology.

Other reporting changes. Director compensation reporting would retain qualitative and quantitative disclosure of material program features and amounts earned by each board member. The proposal would remove certain prescriptive presentation requirements and compensation elements that may not reflect typical director compensation structures.

Qualitative disclosure of material terms would replace prescriptive quantitative disclosure of potential payments and benefits in hypothetical termination or change-in-control scenarios. Golden parachute compensation disclosure would retain tables, with streamlined presentation requirements and more flexibility for accompanying narratives.

Registrants using long-form registration statements, such as Form S-1, would have up to 120 days after fiscal year end to provide executive compensation disclosure for the last fiscal year. That would match the period the fact sheet says is currently available for short-form registration statements such as Form S-3.

The proposal would also eliminate disclosure requirements concerning risk management-related compensation policies and practices and equity awards granted close in time to the release of material nonpublic information.

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