The meetings industry welcomed the new executive compensation rules issued by the U.S. Treasury Department on June 10 as a bullet dodged. The interim final rule, now in a 90-day public comment period, requires companies receiving Troubled Asset Relief Program funds to develop a companywide policy for meetings, events, and other corporate travel expenses — but leaves the specifics of the policy up to each company's board of directors.
According to the ruling, this approach “is similar to the method by which public companies adopted a code of ethics under section 406 of Sarbanes-Oxley.” In that case, companies were given a general framework for a code of ethics but allowed to adopt standards specific to their circumstances.
Unfortunately, said Geoff Freeman, vice president of the U.S. Travel Association, speaking at the Exhibition and Convention Executives Forum meeting in Washington in mid-June, the rules are lumped in with TARP requirements for “excessive or luxury expenditures.”
“Meetings are a necessary business function, not a frivolous expense,” Freeman said. “You don't hear attacks on companies spending money on advertising or, but you hear attacks on companies spending money on meetings.” It's a perception that the meetings industry must help change, he said.
U.S. Travel and the industry coalition that galvanized around it last fall have created a model policy, which they urge all companies, even those not receiving TARP funds, to adopt.
If companies know they are following a standard policy, Freeman believes, “they won't be afraid to dip their toes back in the water.”
Visit the coalition's Web site, www.meetingsmeanbusiness.com, for the full text of the rule, the model board policy, and many other resources.