SEC's Gensler defends controversial clawback rule, saying it won't stop companies from going public

A caller Securities and Exchange Commission regularisation that would let the bureau to reclaim compensation from definite executives should not discourage companies from going public, SEC Chair Gary Gensler said Friday.

The "clawback rule" broadens SEC regulators' authorization to retrieve compensation to existent and erstwhile executives of nationalist companies that was awarded based connected errors successful their fiscal statements. Gensler told CNBC's "Squawk Box" that the bureau is pursuing done connected a regularisation mandated by Congress.

"This was a straightforward happening that Congress said," Gensler said. "If you've got the incorrect faulty financials and somebody's getting paid connected those faulty financials, past they ought not support the money. I deliberation it's beauteous straightforward."

Congress mandated the clawback backmost regularisation aft the 2007 fiscal crisis, but it was abandoned successful 2015. The SEC nether Gensler revived it past twelvemonth arsenic portion of a larger effort to rein successful executives for firm wrongdoing.

Gensler denied claims that excessively overmuch of the SEC's rulemaking docket is focused connected regulatory efforts that volition stall successful Congress. He added that Congress mandated astir of the agency's docket implicit a decennary ago.

"We person a three-part mission. It's astir capitalist protection. It's astir superior formation. It's astir the markets," Gensler told CNBC. "Eight of our parts of our regulatory docket [were] mandated by Congress 12 years agone successful that Dodd Frank Act. We really had different mates of mandates arsenic well. So we had [Congress mandate] 9 oregon 10 of our agenda, but our docket is astir capitalist extortion and the different parts of our mission."