The US Securities and Exchange Commission has proposed changes to how public companies disclose executive and director compensation, aiming to make the information clearer and less burdensome for businesses to prepare. The proposal would update rules last comprehensively reformed in 2006, refocusing disclosures on material information and improving investors' ability to track equity awards as they develop over time.
The SEC said the amendments would reduce compliance burdens for companies where detailed disclosure does not provide meaningful value to investors. At the same time, the changes would give registrants more flexibility to present compensation information in ways that match how their boards and compensation committees actually structure pay programs. The proposal builds on efforts by SEC Chairman Paul S. Atkins to reduce barriers for companies seeking to enter or remain in public markets.
The proposed changes to Item 402 of Regulation S-K, which sets disclosure standards, would allow companies to tailor their compensation disclosures to provide greater transparency about their practices while making the information easier for investors to read and understand. The SEC said the proposal reflects input from more than 80 comment letters submitted by investors, companies and advisors following a roundtable discussion held in July 2025. Chairman Atkins said the amendments are "central tenets" of his agenda to transform the SEC's disclosure requirements to be rooted in materiality.
The public comment period will run for 60 days after publication in the Federal Register. For investors and company shareholders in the United States, clearer executive pay disclosures could make it easier to understand how company leaders are compensated and to compare pay practices across different firms.