With the SEC is tightening rules on executive compensation, an exercise aimed at creating greater transparency regarding company compensation policies, it's probably worth taking a look at the proposed rule changes regarding executive pay and related party transactions. But be warned - make sure there's plenty of coffee on hand because it runs to 370 pages.

At the same time, it's worth checking out the arguments of Edgar Woolard Jr., former chief executive and chairman of DuPont and current chairman of the new york stock exchange's compensation committee in Across The Board published by the Conference Board. You can find it here.

Woolard says that the idea that CEO compensation is driven by competition or that compensation committees are independent is just "bull".

"CEO pay today is driven primarily by outside consultant surveys, and by the fact that many board members have bought into the concept that your CEO has to be at least in the top half, and maybe in the top quartile. So we have the 'ratchet, ratchet, ratchet' concept."

Woolard's piece is accompanied by one from Ira T Kay, global practice director for executive compensation at Watson Wyatt Worldwide. He argues the reverse.