New rules are supposed to make executive pay reports more readable. But a recent Securities and Exchange Commission analysis of the proxies filed so far this year shows they're as indecipherable as ever — if not more so — SEC Chairman Christopher Cox told an audience in Los Angeles yesterday.

The SEC asked a consulting company to grade the readability of 40 proxies filed under new rules that demand "plain English disclosure."

Cox was hoping the proxies would read like something in Reader's Digest. Instead, he said, the prose was more like what you would find in the Harvard Law Review.

"Many adults simply cannot read at this level," Cox told a conference on corporate governance at the University of Southern California's Marshall School of Business. "I am disappointed at the lack of clarity."

In response to a question, Cox declined to say whether companies would be fined for failing to follow the plain English mandate. But the fact that the question was asked in a public forum, he said, might have a "salutary effect" on upcoming disclosures.

"The SEC is dead serious about expecting companies to shed 70 years of bad habits," he added. "Ordinary people are busy. They don't have time to find out that the disclosure they need is buried in a footnote on page 67."

Companies have claimed that the SEC's guidelines are the culprit, calling for disclosures that are naturally complex. Cox disagreed.

"When we say 'plain English,' we mean 'plain English,' " he said. "The companies that have already filed proxy statements will not have to refile. But, it will be more difficult to get through this screen next year."

Meanwhile, Cox said the SEC is only a few weeks away from launching interactive software that will make it easier for investors to find and compare compensation of corporate executives. The new system electronically will tag key bits of information — such as the total compensation tallied in proxy statements under the new rules.