What is say-on-pay? (2026)
Say-on-pay is the shareholder vote on executive compensation that a US listed company must put on its proxy. Shareholders vote on a separate resolution approving the pay of the named executive officers, exactly as that pay is disclosed in the proxy statement. The vote is advisory, so the board is not bound by the result, but the result is public and counted. This guide explains what say-on-pay is, how often it runs, and where to read the outcome. It is not investment advice.
Definition
Say-on-pay
is a separate shareholder advisory vote to approve the compensation of a US listed company's named executive officers, as disclosed under Item 402 of Regulation S-K. SEC Rule 14a-21(a) requires it at least once every three years. The vote is not binding on the company or its board. Source: SEC.
What is say-on-pay and where does it come from?
Say-on-pay came out of the Dodd-Frank Act of 2010, which added Section 14A to the Securities Exchange Act. The SEC implemented it in Rule 14a-21, at 17 CFR 240.14a-21.
The rule attaches to a proxy solicitation for a shareholder meeting at which directors will be elected and for which executive compensation disclosure under Item 402 of Regulation S-K is required. The company must include a separate resolution asking shareholders to approve the compensation of its named executive officers as disclosed in that proxy statement. The first votes were required at the first shareholder meeting on or after 21 January 2011, and on or after 21 January 2013 for smaller reporting companies. Emerging growth companies are outside the requirement.
Because the resolution points at the Item 402 disclosure, the vote and the document are inseparable: shareholders are voting on the Compensation Discussion and Analysis, the compensation tables, and the narrative that goes with them.
How often does the vote happen?
Two separate clocks run.
| Vote | Rule | Required frequency |
|---|---|---|
| Say-on-pay | 14a-21(a) | No later than the meeting in the third calendar year after the previous say-on-pay vote |
| Say-on-frequency | 14a-21(b) | No later than the meeting in the sixth calendar year after the previous frequency vote |
The say-on-frequency vote is the vote about the vote: shareholders say whether say-on-pay should occur every 1, 2, or 3 years. Most US companies run say-on-pay annually, which reflects what shareholders have generally asked for in those frequency votes rather than a legal minimum.
3 years
Outer limit for say-on-pay under SEC Rule 14a-21(a): the vote must come no later than the shareholder meeting held in the third calendar year after the preceding one
Source: 17 CFR 240.14a-21(a)
Is the vote binding?
No. Section 14A(c) of the Exchange Act makes both say-on-pay and the frequency vote advisory. The result does not overrule the board, does not change existing compensation arrangements, and does not create additional fiduciary duties.
What it does create is a public number. Approval percentages are disclosed, so a year in which support drops sharply is visible in the filings, and companies typically respond in the next proxy statement by describing shareholder outreach or changes to the pay programme. The signal is the disclosure, not the legal effect.
Where to read say-on-pay results
The proposal itself lives in the annual meeting proxy statement, DEF 14A, covered in what is a proxy statement, and the mechanics of reading one are in how to read a proxy statement. The result is reported after the meeting on a Form 8-K under the item for submission of matters to a vote of security holders, so the vote tallies are a dated filing you can pull from EDGAR.
A related but separate vote appears in deal proxies: what is a golden parachute covers the advisory vote on change-of-control compensation, and say-on-pay vs golden parachute vote sets the two side by side. How institutional holders actually voted is itself disclosed, in the annual proxy-voting record described in what is a Form N-PX filing.
So, what is say-on-pay in one line: the advisory shareholder vote on named-executive compensation required by Rule 14a-21, held at least every three years and reported in the filings. Flock reads these public filings and keeps each one dated and linked to its source. What any of it means for your money is your call to make.
Frequently asked questions
What is say-on-pay?
Say-on-pay is a separate shareholder advisory vote to approve the compensation of a US listed company's named executive officers, as disclosed in the proxy statement under Item 402 of Regulation S-K. It is required by SEC Rule 14a-21(a) and is not binding on the company or the board. Source: 17 CFR 240.14a-21.
How often must a company hold a say-on-pay vote?
At least once every three years. Rule 14a-21(a) requires the vote no later than the shareholder meeting held in the third calendar year after the immediately preceding say-on-pay vote. Most companies hold it annually, which is a choice shareholders themselves express in the say-on-frequency vote. Source: 17 CFR 240.14a-21(a).
What is the say-on-frequency vote?
A separate advisory vote on how often say-on-pay should happen: every 1, 2, or 3 years. Rule 14a-21(b) requires it no later than the meeting held in the sixth calendar year after the previous frequency vote, so in practice it appears about every six years. Source: 17 CFR 240.14a-21(b).
Is a failed say-on-pay vote binding on the board?
No. Section 14A(c) of the Exchange Act makes the vote advisory, so it does not overrule the board or create new fiduciary duties. It is a disclosed signal: a low approval percentage is public, and companies usually address it in the following year's proxy statement. Source: SEC.
Flock tracks these filings, sourced, dated, and linked back to the original. See what smart-money entities disclosed, without the guesswork about what it means.
Disclosures shown are public regulatory filings. Data may be delayed or incomplete. Smart-money entities may no longer hold positions shown. Not investment advice.