SEC Approves NYSE and Nasdaq Clawback-Related Listing Standards | JD Supra

The SEC approved the updated rules proposed by NYSE and Nasdaq about clawbacks on June 9, 2023. It was given accelerated approval, and messages and decrees were issued. You can read about the changes and what they entail in our previous post.

The NYSE and Nasdaq have officially announced their new listing standards regarding clawback policies, which will become effective on October 2nd, 2023. This will require companies listed on these exchanges to establish compliant clawback policies by December 1st, 2023, and enforce them for executives who receive incentive-based compensation starting from October 2nd, 2023 based on the stock exchange's definitions of such rewards.

New rules will be implemented for companies listed on the NYSE and Nasdaq regarding clawback policies. These rules will be outlined in Section 303A.14 of the NYSE Listed Company Manual and Nasdaq Rule 5608. These rules are similar to requirements outlined in Rule 10D-1 of the Securities Exchange Act of 1934 that require listed companies to have a written clawback policy and disclose it in SEC filings to avoid delisting. To further understand the details of Rule 10D-1, reference our previous Client Alert.

You can find the SEC's notification and decision to quickly approve the NYSE's proposed listing guidelines here, and the SEC's notification and decision to quickly approve Nasdaq's proposed listing guidelines here.