November 21, 2013
Dear Securities and Exchange Commission:
I am an investor in publicly traded companies through my retirement plan and personal savings. I expect to rely on the income from these investments in retirement, so I am very interested in the ongoing success of the companies I have invested in.
I strongly support the SEC’s proposal requiring companies to disclose the CEO-to-median worker pay ratio, as required by the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Pay ratio disclosure will help investors evaluate CEO pay levels when voting on executive compensation matters. The ratio of the CEO-to-worker pay is a valuable metric for investors, because it places CEO pay levels into a broader perspective.
For example, investors may use pay ratios as a factor when casting say-on-pay votes. Pay ratio disclosure also will help investors better understand their company’s overall compensation for all employees.
High CEO-to-worker pay ratios can have a negative impact on employee morale and productivity. Disclosure of the pay ratios will help the capital markets better allocate capital to those companies that invest in their workforces.
I further believe that shareholder votes on executive pay should be binding, particularly when voted on over multiple years. Shareholders are the owners of the company, and should have the right to set pay for executives.
Sincerely,
Matthew Larsen
Menlo Park, CA