On October 26, 2022, the Securities and Exchange Commission (the “SEC”) adopted rules and rule amendments to implement the compensation recovery (or “clawback”) requirements of Section 954 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (“Dodd-Frank”). The SEC’s clawback rules direct the national securities exchanges to establish listing standards to require virtually all listed companies to adopt and enforce clawback policies providing for “no-fault” recovery of erroneously awarded incentive-based compensation received by current or former executive officers as a result of material noncompliance with financial reporting requirements. The SEC’s rules also impose related disclosure requirements on listed companies.
A brief summary of the SEC’s Dodd-Frank clawback rules is provided in the PDF below.
