In this new memo: "Public Company Summer/Fall To-Do List: 5 Steps Toward CEO Pay Ratio Disclosure," Latham & Watkins addresses key considerations involved in these five critical CEO Pay Ratio disclosure preparation action items:
1. Form a team
2. Determine the message and audience
3. Identify, gather, and process the data necessary to determine the median employee and the median employee's compensation.
4. Decide how and where in the proxy statement to present the CEO Pay Ratio disclosure and prepare a mockup of the disclosure.
5. Determine the corporate governance process and an appropriate timeline for completing the process.
Among the important tips/reminders are: consideration of the multiple constituencies that will likely read and react to the company's disclosure; implications and upsides/downsides to selecting a particular date and time period for determining the median employee; and the disclosure's coverage by the CEO/CFO SOX certification and associated processes, policies, controls, and procedures - including advance vetting with the Compensation Committee and management.
Access numerous additional resources on our Pay Ratio topical page.
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Further to our report in the July 12th Society Alert, the Society's Securities Law Committee is hosting a Pay Ratio teleconference for all members on August 2nd. Members should register and submit questions here.
This item was first reported in last week's Society Alert.
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