SEC Tightens Rules on Information to Be Placed on Proxy Statements

Public companies will have to disclose to shareholders the pay packages of all CEOs, not just the one in charge at year’s end, under new rules approved by regulators Monday.

In an effort to fine-tune proxy rules it adopted last fall, the Securities and Exchange Commission voted for a number of changes concerning the documents sent to shareholders before a company’s annual meeting.

The changes “are intended to make compensation disclosure clearer, more comprehensive and more useful to shareholders and the market,” SEC Chairman Arthur Levitt Jr. said.

Last year, the SEC adopted rules requiring corporations to spell out for shareholders how much top executives are paid and to compare the company’s stock performance to similar firms.

After reviewing this year’s proxies, the SEC staff recommended, and the commissioners approved, some alterations, including requirements that companies:

* Disclose the pay packages for all chief executives employed during the past year, not just the one in charge when the fiscal year ends.

* Divulge all awards to top executives of stock with preset limitations on when it can be traded, known as restricted stock.