Writing for the FT’s Agenda, reporter Tony Chapelle states in his piece, “Most Directors Say Clawback Policies ‘Are Sufficient’: Survey”:
More corporate boards are setting policies on clawing back executives’ pay even as Washington continues to give mixed signals about what triggers should be in the final regulations. The majority of compensation committees on corporate boards have considered some type of clawback provision that would apply to their named executive officers and senior managers.
Greg Lau advises that boards make sure clawback policies that can recover incentive compensation are definitive and not left to the discretion of comp committees. He is a managing director who leads the board advisory practice at RSR Partners, an executive search firm headed by recruiter Russell Reynolds. Lau, a retired executive director of global compensation and corporate governance at General Motors, says that even if an officer knowingly engaged in fraudulent but non-financial activity such as Volkswagen managers did in the Dieselgate emissions cover-up, “that probably should be covered.” But he cautions, “We need to be careful in expanding the scope beyond the restatement of financial statements due to negligence, fraud or intentional misconduct.”
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