Monday, February 15, 2010

Outreach Task Force: Senior Executive Officer Compensation

The NCUA's Outreach Task Force issued a report in Feruary 2008 which stated NCUA and federal credit unions (FCUs), both natural person and corporates, would benefit from the collection of senior executive compensation data.

The Outreach Task Force concluded that since FCUs are cooperatives, the members/owners have a right to know the total compensation paid to senior officials. The Outreach Task Force believed that increased transparency will improve accountability and be more consistent with prevailing public policy.

Therefore, the Task Force recommended that the NCUA Board take the following actions:
• collect FCU and federal corporate credit union senior executive officer
compensation;
• publish aggregate data on senior executive officer compensation in the Annual
Report or other NCUA publication(s); and
• promulgate a regulation requiring FCUs and federal corporate credit unions to
annually disclose individual senior executive officer compensation to their
members.

NCUA is putting some of the recommendations into effect. NCUA is proposing that corporate credit unions release information on senior management compensation to their members.

The next step will be to propose rules for FCUs, which requires senior executive officer compensation to be disclosed to members. State chartered credit unions already disclose this information in their annual Form 990 filing with the Internal Revenue Service.

Also, I'm hopefully that when NCUA finally releases its Annual Report for 2008, it will include information about senior executive officer compensation and that this information is disclosed in a format where it can be meaningfully analyzed.
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