Question

According to the provisions of the _____, publically listed companies now must allow shareholders to vote on executive compensation.

Answer 1

Answer:

According to the provisions of the Dodd-Frank Act, publically listed companies now must allow shareholders to vote on executive compensation.

Explanation:

In the aftermath of the financial crises of 2008, shareholders of public companies were given the right to vote or in short have their say on executive compensation matters or rules framed by the directors.

The said rule conferred a right on the shareholders to vote once in three years on executive compensation so as to keep excessive compensation to executives in check.

The companies in such a scenario ain't bound by such votes but such a right to shareholders represents their outlook on the decisions made by the Board.