Lots more buzz about the impact—or lack thereof, depending on who you ask—of the Treasury’s executive compensation rules under the Emergency Economic Stabilization Act.

As reported by Compliance Week, some observers say the provisions lack real teeth and won’t have much impact, while others say they may portend executive pay reforms to come when a new administration enters the White House.

The Treasury put some meat on the bones of the rules previewed in the legislation in a recent press release. The executive compensation and corporate governance standards generally apply to the chief executive officer, chief financial officer, plus the next three most highly compensated executive officers of any firm participating in any of the three programs:

Under the Troubled Asset Auction Program, any financial institution that sells more than $300 million of troubled assets to the Treasury via an auction would be prohibited from entering into new executive employment contracts that include golden parachutes for the term of the program, to be detailed in Treasury Notice 2008-TAAP.

Additionally, under new tax rules detailed in IRS Notice 2008-94: those financial institutions can’t take a tax deduction for executive compensation in excess of $500,000 for each senior executive; can’t deduct certain golden parachute payments to its senior executives and a 20 percent excise tax will be imposed on the senior executive for those golden parachute payments.

Any financial institution participating in the Capital Purchase Program will be subject to more stringent executive compensation rules for the period during which Treasury holds equity issued under the program. The companies must meet certain standards, including: (1) ensuring that incentive compensation for senior executives does not encourage unnecessary and excessive risks that threaten the value of the financial institution; (2) required clawback of any bonus or incentive compensation paid to a senior executive based on statements of earnings, gains, or other criteria that are later proven to be materially inaccurate; (3) prohibition on the financial institution from making any golden parachute payment to a senior executive based on the Internal Revenue Code provision; and (4) agreement not to deduct for tax purposes executive compensation in excess of $500,000 for each senior executive. Treasury is issuing interim final rules for these executive compensation standards.

For the Programs for Systemically Significant Failing Institutions, a program to potentially provide direct assistance to certain failing firms on terms negotiated on a case-by-case basis, the executive compensation standards will be the same as those for the Capital Purchase Programs, with one difference: In situations where Treasury provides assistance under the systemically significant failing institutions’ programs, golden parachutes will be “defined more strictly to prohibit any payments to departing senior executives.”