Coalition urges better disclosure of executive pay

February 10, 2002|By BLOOMBERG NEWS

WASHINGTON - A coalition of minority advocacy groups is calling on the Securities and Exchange Commission to push companies to make clearer disclosure of executive compensation in their annual reports.

Corporate 10-K annual report forms should list the total compensation of a company's top five executives, including stock holdings, after-tax income and charitable donations, the San Francisco-based Greenlining Institute said in a letter to the SEC.

Changes in compensation reporting requirements are needed following Enron Corp.'s collapse, the institute said. Top Enron executives made millions selling company shares obtained through stock options, while many lower-level employees weren't permitted to sell shares in their 401(k) plans.

"Since excessive executive compensation may be an indicator of irresponsible corporate behavior and possibly violate fiduciary duties, we believe that such transparency should be required as soon as possible," the groups said in a letter last week to SEC Chairman Harvey Pitt.

"Pitt has an unprecedented opportunity to change 10-K reporting so that such executive profiteering can no longer happen undetected," the groups said in a news release.

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