The Stock Exchanges and the Factors for Director Independence: A Comment Letter

Abstract:     
In Section 952 of Dodd-Frank, Congress gave the Securities and Exchange Commission the authority to adopt a rule that required stock exchanges to implement listing standards regulating the compensation committees of the board of directors. In accordance with this provision, the Commission in Exchange Act Release No. 67220 (June 20, 2012) adopted Rule 10C-1. The Rule directed the exchanges to adopt the requisite listing standards. These standards were required to include the "relevant factors" that had to be considered in determining the independence of directors on the compensation committee. This letter recommended, among other things, that in articulating these factors, the exchanges specify the need to consider fees paid to directors for their service on the board and the need to consider personal and business relationships among directors and executive officers.

Number of Pages in PDF File: 6

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