Under New York Stock Exchange and the NASDAQ Stock Exchange rules that were approved by the Securities and Exchange Commission (SEC) in January of this year, companies listed on those exchanges must comply by July 1, 2013 with new independence requirements for compensation committee advisers. Specifically, by July 1, 2013, compensation committees must:
- Have authority to retain compensation consultants, legal counsel and other compensation advisers,
- Have authority to pay reasonable compensation to such advisers with funds provided by the company, and
- Have the responsibility to consider independence factors before selecting such advisers.