On October 5, 2012, the Council of Institutional Investors (CII) released updated corporate governance policies. The primary change in regards to executive compensation involved a tightening of the CII’s policies with respect to clawbacks. CII now calls for companies to:
- Ensure that sufficient and appropriate mechanisms and policies are in place to recover erroneous bonus and incentive awards paid in cash, stock or any other form to current or former executive officers and to prevent the payout of such awards in the first place.
- Establish a minimum recovery period of at least 3 years following discovery of the fraud or cause forming the basis for the recovery.
The CII’s revised Corporate Governance Policies can be found at: