Direct the national securities exchanges to establish listing standards requiring companies to adopt and comply with a policy for the recovery of erroneously awarded incentive-based compensation from current and former executive officers (clawback policy).

Amend Regulation S-K, Form 10-K, Form 40-F, and Form 20-F to include new disclosure requirements related to the required clawback policies, including how the companies implement their clawback policies.

Question 121H.01. Under the implementation timeframe adopted by the SEC, securities exchanges have until February 27, 2023 to propose the required listing standards and such standards do not have to become effective until November 28, 2023. Listed companies will then have 60 days to adopt a clawback policy compliant with the effective listing standard. However, the amended rules and forms, including new check boxes on the cover of Forms 10-K, 40-F, and 20-F, are effective now. New Question 121H.01 provides needed clarity that despite the rule and form amendments becoming effective in 2023, the SEC does not expect compliance with the disclosure requirements until companies are required to have a clawback policy under the applicable exchange listing standards.

Questions 121H.02 and 121H.03. New Questions 121H.02 and 121H.03 provide clarification on which persons will be considered named executive officers for purposes of determining whether individualized disclosure is required under Item 6.F of Form 20-F and Item B.(19) of Form 40-F, respectively (the Division also added identical Exchange Act Forms C&DI Questions 110.08 and 112.03).

Question 121H.04. New Question 121H.04 reiterates that the clawback rule is intended to apply broadly. To the extent a compensation plan takes into account incentive-based compensation, companies will be expected to claw back the amount, and earnings accrued on that amount, contributed based on erroneously awarded incentive-based compensation.