New York City Comptroller John Liu provided supporting comments in favor of a proposed Securities and Exchange Commission rule to implement Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which requires companies to disclose the ratio of total compensation of chief executive officers to the median pay of employees.
In his Nov. 27 letter to the SEC, Liu noted that the New York City pension funds had adopted an explicit policy in favor of such disclosure well before the Dodd Frank Act of 2010.
"Massive pay disparities between CEOs and most workers are corrosive to morale and productivity at individual businesses and harm the broader economy," Liu said. "The SEC's proposed rule will shed light on those companies that value the contributions of all employees and those whose pay practices undermine long-term value creation. This is the kind of information our pension funds find valuable in evaluating and voting on executive pay at our roughly 3,500 U.S. portfolio companies."
Liu will leave office on Jan. 1, having run unsuccessfully for mayor. Scott Stronger will succeed him. The comptroller serves as the investment advisor, custodian, and trustee of the city's five public employee pension funds, which have $144 billion in assets under management.