Below is an excerpt from our comment letter responding to the Securities and Exchange Commission’s requests for comments on the Executive Compensation Disclosure Roundtable on June 26, 2025.
Dear Ms. Countryman:
We appreciate the opportunity to participate in the Commission’s Executive Compensation Disclosure Roundtable on June 26, 2025 (the “Roundtable”), and to submit comments informed by our client experience and investor interactions.
Semler Brossy advises public companies across industries and company sizes on executive compensation strategy, disclosure, and investor engagement. This position gives us a unique view into how boards make pay decisions, how investors interpret disclosures, and where the disclosure framework can evolve to better serve both.
We support the Commission’s goal of improving the clarity, comparability, and utility of executive compensation disclosure. We have followed the extensive commentary submitted by other market participants and seek to contribute constructively to that dialogue, informed by a balanced focus on issuers and investors. Our recommendations stand out in a couple of important respects:
- Streamlined SCT/Equity Disclosure: While many commenters suggest incremental revisions to the existing Summary Compensation Table and related disclosures, we recommend replacing the current patchwork with a coherent framework of five streamlined tables. These tables are designed to reflect how boards set pay, how investors evaluate it, and how issuers already present elements such as pay mix in the CD&A. By building on practices already in use, our suggested approach enhances comparability, reduces redundancy, and makes disclosure more intuitive.
- Practical Pay Versus Performance Alternative: Commenters have highlighted the challenges with the “Compensation Actually Paid” (CAP) measure, noting its complexity and limited usefulness. We agree with those observations, and we propose an alternative grounded in compensation actually earned. This approach preserves the intent of the rule while simplifying disclosure and making outcomes easier for investors to interpret.
These recommendations reflect themes we have heard in hundreds of conversations with issuers and investors and are designed to make disclosure more useful and manageable for all parties.
We believe they will enhance comparability, simplify complexity, and lead to more meaningful communication between companies and their investors.
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