The Securities and Exchange Commission is about to issue new rules that would require companies to punish accounting missteps by clawing back pay from a wider range of top executives, the Wall Street Journal reported today. Many companies object to the proposed rules, which are awaiting the SEC’s final approval after a public-comment period ended last month. Corporate critics say that the rules could wallop executives who had no knowledge of errors in the books or any role in overseeing them. The Dodd-Frank Act of 2010 required the SEC to write the rules, in hopes that putting executive pay at risk would discourage fraud and undue risk taking. The rules apply only to pay that is tied to a company’s financial performance, a type that is increasingly common.
