USA: SEC adopts pay ratio disclosure rule

The Securities and Exchange Commission has this week adopted a final rule that will require certain public companies to disclose the ratio of the compensation of their chief executive officer to the median compensation of their employees: see here (pdf). The SEC was required to adopt such a rule in order to implement section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.

A short fact sheet explaining the new rule is available here. An update on the SEC's progress in implementing the mandatory rule making provisions of the Dodd-Frank Act can be found here.

Australia: Treasury consultation - crowd sourced equity funding framework

The Australian Treasury has published a consultation paper titled Facilitating crowd-sourced equity funding and reducing compliance costs for small businesses: see here (pdf). The paper sets out the key elements of the proposed crowd sourced equity funding framework for public companies and seeks views on what changes should be made in respect of proprietary companies.

UK and Jersey: Judicial Committee considers 'backward tracing'

The Judicial Committee of the Privy Council gave its opinion earlier this week in The Federal Republic of Brazil v Durant International Corporation (Jersey) [2015] UKPC 35, an appeal from the Court of Appeal of Jersey ([2013] JCA071): see here or here (pdf). The hearing took place in May, and can be watched here (part 1) and here (part 2). The Board's opinion is an important one concerning the doctrine of tracing and, in particular, backward tracing. Lord Toulson, delivering the board's opinion, stated (para. [40]):

The Board ... rejects the argument that there can never be backward tracing, or that the court can never trace the value of an asset whose proceeds are paid into an overdrawn account. But the claimant has to establish a coordination between the depletion of the trust fund and the acquisition of the asset which is the subject of the tracing claim, looking at the whole transaction, such as to warrant the court attributing the value of the interest acquired to the misuse of the trust fund. This is likely to depend on inference from the proved facts, particularly since in many cases the testimony of the trustee, if available, will be of little value".

A summary of the Board's opinion is available here (provided by the ICLR).

UK: PRA updates its supervisory statement on internal governance

The Prudential Regulation Authority published several policy and supervisory statements yesterday: see here. Amongst them was a revised edition of Supervisory Statement 21/15, Internal Governance, which now includes sections for the chief risk officer and the risk committee: see here (pdf).

UK: Financial Advice Market Review - terms of reference published

The terms of reference for the recently launched Financial Advice Market Review were published today: see here. Further information about the Review, which is being jointly led by HM Treasury and the Financial Conduct Authority, is available here and here.