Management accounting


A rule proposed by the SEC would require U.S. public companies to disclose the ratio between what companies pay their CEOs and their median employee.

SEC commissioners voted 3–2 to propose the rule, which was mandated by the Dodd-Frank Wall Street Reform and Consumer Protection Act, P.L. 111-203.

If the rule is approved, companies would be required to disclose:

  • The median of the total annual compensation of all their employees except the CEO.
  • The annual total compensation of the CEO.
  • The ratio of the two amounts.


The proposal, available at tinyurl.com/ou47lmc, was drafted to provide companies with flexibility in complying with the requirement while fulfilling the Dodd-Frank requirement, SEC Chairman Mary Jo White said.

Where to find January’s flipbook issue

Starting this month, all Association magazines — the Journal of Accountancy, The Tax Adviser, and FM magazine (coming in February) — are completely digital. Read more about the change and get tips on how to access the new flipbook digital issues.

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