Menendez to Corporate America: Say What You Pay

Menendez to Corporate America: Say What You Pay

Reported action to require disclosure of CEO to worker pay ratio comes as three year anniversary of Wall Street Reform approaches

WASHINGTON, DC - U.S. Senator Robert Menendez, author of the provision in Dodd-Frank Wall Street Reform to require public companies to disclose how much more their CEOs' are paid than rank and file workers, today called reports that the SEC would issue rules to implement the requirement "welcome news."

"It's been nearly three years since Wall Street Reform required public companies to disclose just how much their CEO's are compensated compared to their average worker, and since then the gulf has only grown," said Sen. Menendez, who sits on the Senate Banking and Finance committees. "It's a simple request of companies: Say what you Pay. I have been calling on the SEC to issue this rule so it is welcome news to hear it is being seriously considered, and I urge the SEC to move forward without further delay."

According to data compiled recently by Bloomberg news, across the Standard & Poor's 500 Index of companies, the average multiple of CEO compensation to that of rank-and-file workers is 204 - up from 170 in 2009 - with executives at some companies raking in more than 1000 times as much as their average worker. Over the last decade, median family income fell for the first time since the Great Depression.

Senator Menendez drafted a provision requiring disclosure of this information included as Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act which passed nearly 3 year ago. While there was no deadline by which the rule must be finalized, some companies have fought against it, claiming it increases compliance costs and is overly burdensome. Menendez has been calling on the Commission to issue the rules needed to implement the requirement since the law passed, including a letter in 2011 and 2012.

"Income inequality is a real, growing concern in our nation, as it should be. We have middle class Americans who have gone years without seeing a pay raise, while CEO pay is soaring," Menendez added. "A company's treatment of their average workers isn't just a reflection of their corporate values - it's also important information for shareholders to properly monitor the size and incentive structure of executive compensation."

Image from Senator Menendez's Facebook page showcasing Bloomberg's data

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