Deadline Approaches for NASDAQ-Listed Companies to Implement New Compensation Committee Standards
As annual meeting season approaches, so too does the first deadline for companies listed on the NASDAQ Stock Market (Nasdaq) to comply with amended compensation committee rules. Traditionally, evaluation of director independence of Nasdaq-listed companies differed for purposes of serving on an audit committee as compared to a compensation committee. Earlier this year, the Securities and Exchange Commission (SEC) approved Nasdaq's proposed rule amendments to comply with certain requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, including changes intended to conform the compensation committee independence standard to the existing audit committee standard. The first of these new requirements - compliance with Nasdaq Listing Rule 5605(d)(3) - is going into effect on July 1, 2013.