This is the Week to Make Your Voice Heard on CEO Pay Disclosure

March 20, 2017

Here is an important action you can take this week: Write a letter to the SEC saying how essential our newly enacted CEO-to-worker pay ratio disclosure rule is and why it must be protected. Donald Trump’s acting SEC chair, Michael S. Piwowar, has reopened public comment on the rule, which has already taken years to implement, in a thinly veiled attempt to delay or weaken it.

Why is CEO pay important?

In 1970, CEOs made 23 times the typical American worker. In 2015, this number was 276. And as this infographic illustrates, sky-high CEO pay is not just an ethics issue. It produces devastating costs for the broader economy in the form of tax windfalls, increased propensity for firms to commit fraud and take on excessive risk (which helped collapse the global economy in 2007-08), and incentives for companies to invest less in their-long term growth, including their workforce. CEO pay is also a major driver of our inequality crisis.

What’s more, CEO pay is a political issue that can galvanize populists on the left and the right. According to a 2016 Stanford University poll, most Americans think CEOs are paid far too much and support drastic reductions.

Why is the CEO-to-worker pay disclosure rule so important?

The disclosure rule accomplishes several things at once. It indicates to shareholders and the public which companies are managing their companies responsibly and committed to long-run viability, it demonstrates to workers how invested their companies are in them, and it leaves room for regulation to be built based on the disclosed information. In 2016, Portland, Oregon, became the first city to adopt a tax penalty on companies with high pay ratios. Rhode Island and San Francisco are following suit, but these legislative efforts will be much more difficult, if not impossible, to pass without the SEC’s disclosure rule.

What can you do?

The public window for commenting on 953b—as its formally known—is the end of this week. Submit a comment to the SEC as a voter and a shareholder saying that we must protect the CEO-to-worker pay ratio disclosure rule for the good of our companies, our workers, and our economy. (Do you have a retirement account? Have a 529 college savings plan? You are a shareholder.)

To submit your comment, you can send an email to The subject line of your message should just say 953b.

Here is a sample email:

I write to comment that I am in full support of Section 953b of the Dodd-Frank Wall Street Reform and Consumer Protection Act or the CEO/worker pay ratio disclosure rule.

This disclosure rule is crucially important for indicating to shareholders, to workers, and to the public whether or not manager and boards are governing companies responsibly.

There is ample research to suggest that relatively high CEO pay creates bad incentives that lead to excessive risk-taking, diminished investments in corporations, and even fraudulent activity. 953b provides an incredibly useful indicator for measuring the potential of these outcomes. It is essential that you do not disrupt the implementation of this rule.