(Bloomberg) -- U.S. Securities and Exchange Commission Chair Gary Gensler said he is keen to finish a long-stalled requirement to clamp down on Wall Street bonuses when companies report incorrect financial information.
Gensler said he’s asked SEC staff to provide recommendations on a rule for clawing back executive pay and other parts of never-finished regulations that were mandatory under the Dodd-Frank Act. Specifically, Gensler said he wants to make sure that executives return any funds they are overpaid when a company publishes incorrect information in its financial statements.
“This is a simple concept that executives should not be paid based upon financial performance that is misreported,” Gensler said at an event Wednesday sponsored by the Council of Institutional Investors.
Pay practices that rewarded quick deals and short-term gains were blamed for contributing to the financial crisis. Under the Dodd-Frank regulatory overhaul signed into law almost two years later, regulators were required to limit those kinds of incentives to help protect the financial system. Yet more than a decade later, several rules that the SEC was required to finish -- including one on claw backs -- are yet to be finalized.
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