Jesse M. Fried, Rationalizing the Dodd-Frank Clawback (European Corp. Governance Inst. (ECGI) - Law Working Paper No. 314/2016, Sept. 26, 2016).
Abstract: On July 1, 2015, the Securities and Exchange Commission (SEC) proposed an excess-pay clawback rule to implement the provisions of Section 954 of the Dodd-Frank Act. I explain why the SEC’s proposed Dodd-Frank clawback, while reducing executives’ incentives to misreport, is overbroad. The economy and investors would be better served by a more narrowly targeted “smart” excess-pay clawback that focuses on fewer issuers, executives, and compensation arrangements.