Executive Compensation Disclosure Agent
Prepares and validates proxy statement executive compensation disclosures against SEC pay-versus-performance and clawback rule requirements.
Public companies must prepare increasingly complex executive compensation disclosures for the annual proxy statement, including the SEC's pay-versus-performance table, Compensation Discussion and Analysis narrative, and clawback policy disclosures, each with detailed and frequently updated technical rules on calculation methodology
Compensation committees and legal teams must reconcile compensation data from equity administration systems, payroll, and board-approved grant records, and even small calculation errors in the pay-versus-performance table can trigger SEC comment letters or require costly restatement
Clawback policy compliance requires tracking whether an accounting restatement has triggered recoupment obligations under the Dodd-Frank clawback rules, a process easy to overlook during a busy audit cycle
Disclosure drafting is typically compressed into a tight proxy season timeline, leaving little room for the multiple rounds of data reconciliation these disclosures require
The agent pulls executive compensation data from equity administration, payroll, and board-approved grant records, and calculates the SEC pay-versus-performance table components, including compensation actually paid, using the mandated methodology. It cross-checks calculations for internal consistency and flags discrepancies against prior disclosures, monitors for any accounting restatement events that would trigger clawback policy obligations, and drafts supporting narrative language for the Compensation Discussion and Analysis section. Legal and the compensation committee review the assembled disclosure package before it is finalized for the proxy statement.
Data Aggregation
- Pull executive compensation data from equity administration and payroll systems
- Gather board-approved grant and award records
- Reconcile total compensation across data sources
- Flag missing or inconsistent compensation data points
Pay-Versus-Performance Calculation
- Calculate Summary Compensation Table total and Compensation Actually Paid per SEC methodology
- Apply required equity fair value re-measurement adjustments
- Compute company and peer group total shareholder return
- Validate calculations against prior year for consistency
Clawback and Narrative Support
- Monitor for accounting restatements triggering Dodd-Frank clawback obligations
- Track recoupment status for any triggered clawback
- Draft supporting narrative language for Compensation Discussion and Analysis
- Flag disclosure items requiring compensation committee input
Review and Filing Support
- Assemble full disclosure package for legal and committee review
- Cross-check final figures against XBRL tagging requirements
- Track revision rounds through proxy finalization
- Archive final disclosure with full calculation support for audit trail