The Dodd-Frank Act of 2010 added Section 10D to the Exchange Act, which requires the SEC to direct national securities exchanges[1] to prohibit the listing of issuers that do not develop and implement a policy for the recoupment of compensation as specified in Section 10D. On Oct. 26, 2022, the SEC announced that it adopted a final rule (the Release) implementing Section 10D that will impact more than 5,300 exchange-listed companies. This rule requires listed companies to implement, disclose and enforce a compensation recovery policy to claw back or otherwise recover excess incentive-based compensation that executive officers received based on financial reporting measures that are later restated. Thereafter, national securities exchanges were obligated to submit by Feb. 27 proposed listing standards that require listed companies to adopt, disclose and enforce a “compensation recovery policy.” READ MORE