April 6, 2005
Securities and Exchange Commission
Dear Securities and Exchange Commission,
Is it possible for the Securities and Exchange Commission to actually make it possible for the public to see an accurate and true picture of what top executives receive as a reward for gutting corporate finances, devistating whole towns, counties and even states by closing companies and moving production and banking off-shore? There is no question that executive pay packages are unjustly enriching executives at shareholder's expense.
The newly proposed rules will make this crucial information more accessible to shareholders and the public. The new requirements to disclose total compensation figures, pensions and detailed compensation breakdowns will make it clear exactly how much top executives are earning and why.
I believe that CEO pay should be set by independent directors. Under the proposed rule, a director could secretly do $120,000 in business with a company, an amount that is more than four times the average worker's annual pay of $27,460. Shareholders should be told if directors have potential conflicts of interest, no matter what the amount.
I also urge the SEC to require that companies disclose pay-for-performance data. In order for investors to understand how pay and performance match up, companies need to explain more clearly what level of performance is necessary (or unnecessary)for a particular level of pay. I beg the SEC to require companies to disclose both the performance criteria and the performance targets they use when setting executive pay.