A CEO pay disclosure rule legislated by Democrats way back in 2010 is finally coming to fruition.
Rep. Keith Ellison, D-Minn., released a report Wednesday finding that the average CEO is making 339 times the pay of the company’s median worker.
That finding, among others illustrating executives’ pay, is based on disclosures mandated by the 2010 Dodd-Frank financial reform law.
The law, passed by congressional Democratic minorities and signed by former President Barack Obama, required the Securities and Exchange Commission to write a rule requiring public companies to disclose the ratio of CEO to employee pay.
The SEC didn’t propose the rule until 2013, didn’t finalize it until 2015, and only gave companies additional guidance on making the disclosures last year. As a result, now is the first time that many companies are making the disclosures.
The first results were collated by Ellison, a liberal on the House Financial Services Committee and the deputy chairman of the Democratic National Committee.
Reports such as Ellison’s, which calls out companies like McDonald’s and Kohl’s for very high pay ratios, is exactly what corporations were trying to avoid when they sought to stop or delay the rule from going into effect.
Businesses have argued that the pay ratios can be misleading because they compare apples and oranges among companies. For instance, businesses that offshore work cannot be easily compared to ones that have all their workers in the U.S.
