By Dec. 1, 2023, all publicly listed companies must adopt clawback policies that comply with listing standards adopted by the exchanges. These policies must require the company to recover the amount of incentive-based compensation awarded to executives based on financial results that are subsequently restated due to material noncompliance with the securities laws. This would include any required accounting restatement to correct an error in previously issued financial statements that is material to the previously issued financial statements.

Companies must file their policy as an exhibit to their first annual report filed on or after Dec. 1, 2023 (Form 10-K for U.S. domestic issuers and Form 20-F for foreign private issuers). The policy is not required to be posted on a company's website or filed on a Form 8-K.

Failure to adopt a policy may subject the company to delisting from the applicable exchange, though exchanges should give companies the ability to cure any deficiency.

See the U.S. SEC's Fact Sheet for further information.