At the “NASDAQ Speaks ’12: Latest Developments and Interpretations” webcast held on June 7th, there were a couple of interesting items to note. With respect to compensation committee rules, NASDAQ is considering the following changes, subject to the SEC adopting final rules under the Dodd-Frank Act and NASDAQ issuing proposed rules which become final:
- All companies will be required to have a compensation committee with at least 2 members. This differs from the audit committee NASDAQ rule which requires at least 3 directors to serve on the audit committee. Under the current NASDAQ rules, either a compensation committee or independent directors may approve or recommend executive compensation; and
- For a director to serve on the compensation committee, similar to the audit committee rules, such director will not be able to accept any consulting, advisory or other compensatory fee, directly or indirectly, other than for board services. Additionally, the board must consider affiliation a director has with the company. NASDAQ does not think significant ownership of the company’s securities should bar a director from serving on the compensation committee.
This summer NASDAQ is also going to roll-out its new and improved reference library which will permit a user to search reference sources by category, such as staff interpretations, listing council decisions and frequently asked questions. The new reference liability will have an advanced search feature allowing users to search across different reference sources, by year, category and sub-category and keywords. The search results will be expandable and color coded by source.