Study: COVID-19 CEO & Director Pay Actions

Last spring, I wrote about initial reports of executive and director pay changes related to COVID-19. For another look at pay actions taken in response to the pandemic, ...

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Scorecard to Support Rationale of Discretionary Awards

We’ve blogged before about potential use of discretion by compensation committees this year when determining incentive plan payouts, and a recent Pay Governance memo ...

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Director Compensation: Board Pay Flat, Leadership Pay Up

Compensation Advisory Partners recently completed its annual analysis of non-employee director compensation among the 100 largest companies. This is the 10th year CAP ...

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CEO Pay: Annual Bonuses Down, Even Before Pandemic

According to the analysis just released by Willis Towers Watson, median CEO pay in the S&P 1500 was up “only” 5.5% for 2019 performance — the smallest rate of ...

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New IRS Form 1099-NEC for Non-Employee Compensation, Including Directors’ Fees

Way back in 2015, the Protecting Americans from Tax Hikes (PATH) Act of 2015 accelerated the due date for filing any Form 1099 that includes nonemployee compensation ...

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D&I Metrics in Incentive Programs: Usually Discretionary

Earlier this summer, I blogged about a Semler Brossy Report that found 62% of Fortune 200 companies incorporate ESG measures in executive compensation programs. ...

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Seagate Technology’s Overseas Assignment Disclosure

As we all know, Instruction 3 to Item 402(a)(3) of Regulation S-K permits a company to exclude from its named executive officer group an individual who would otherwise ...

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Private Companies: LTIP Design Considerations

A recent Pearl Meyer memo discusses long-term incentive plans and private companies. For many reasons, trying to put a LTIP in place at a private company that offers the ...

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Developing Best Practices in Human Capital Disclosure Now That It’s the Law

Last week, I posted twice on the SEC’s adoption of amendments to Regulation S-K disclosure requiring human capital disclosure. I observed that (a) because the ...

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Human Capital Disclosure Becomes the Law — Part 2

Yesterday, I posted on the SEC’s adoption of amendments to Regulation S-K disclosure to require that companies describe any human capital measures or objectives they ...

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Human Capital Disclosure Becomes the Law

Today, the SEC adopted amendments to Regulation S-K disclosure, including a requirement that companies describe any human capital measures or objectives they focus on in ...

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Pay Adjustments When COVID’s a Boon for Business

We’ve blogged a lot about pay adjustments that may be necessary due to unforeseen challenges that the pandemic has presented. But for some companies, the pandemic ...

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COVID-19 Means Your CD&A Should Address ESG

As I recently discussed, ISS is already saying that COVID-19-related compensation decisions will dominate next year’s proxy season. That means proxy advisors and ...

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Performance Share Adjustments: Plan & Accounting Considerations

I wrote a few weeks ago about a framework for executive pay adjustments. A Mercer memo lays out additional considerations specific to “non-performing” performance ...

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Darden Restaurants’ CEO Pay Ratio Disclosure

As the summer winds down and the fall conferences approach (including this year’s virtual Proxy Disclosure Conference), I’ve been preparing for my presentation on ...

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Update on the Purpose of a Corporation

In May, we posted Jamie Dimon’s “Inclusiveness” Call to Action and Reorienting the Purpose of the Corporation to Serve All Stakeholders, an update on the status of ...

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Investor Interest in Tying ESG to Executive Compensation

We’ve written before about reports showing trends in tying ESG metrics to executive compensation, and a recent Clermont Partners blog looks at shareholder proposal ...

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Company Responses to Low Say-on-Pay Vote Results

Earlier this year, I wrote about disclosure of investor engagement following a failed or low say-on-pay vote result. With a failed or low say-on-pay vote result, most ...

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SEC Settlement Includes Repayment of Incentive Comp

Over a year ago, Liz wrote about Hertz’s lawsuit seeking to recover incentive compensation paid to executives. The lawsuit came about after the company had to restate ...

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Framework for Executive Pay Adjustments

I wrote earlier this week that COVID-related pay decisions will dominate the upcoming proxy season. Unfortunately, the business environment remains uncertain, and ...

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Human Capital: Tipping Point for Board Involvement

We’ve been blogging about “human capital” as an emerging issue for a few years now, but it feels like this year has been the tipping point for the topic to attract ...

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More on “RSUs: New IRS Memo Creates Payment Date & Tax Opportunities”

A couple of weeks ago, I wrote about planning opportunities that may arise for RSUs and performance awards under the “Generic Legal Advice Memorandum 2020-004,” ...

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COVID-Related Pay Decisions Will Dominate Next Year’s Proxy Season

Scrutiny of pandemic-related pay decisions is mounting, as mass layoffs and furloughs draw even more attention to the gap between executive pay and pay of the average ...

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Supporting Stakeholder-Centricity Through Compensation

Liz blogged recently about purpose-related pay goals as discussion about shareholder vs. stakeholder primacy continues. A recent Directors & Boards article from ...

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NetApp’s “Three Questions” Solution

I just finished up a couple of Compensation Discussion and Analyses, and have been reflecting on ways to try to scale back on some of the narrative prose that inevitably ...

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ISS Policy Survey: Questions on Executive Compensation

Over on TheCorporateCounsel.net, I blogged about ISS’s “Annual Policy Survey,” which was announced late last week. Like last year, ISS is using a single survey ...

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RSUs: New IRS Memo Creates Payment Date & Tax Opportunities

A couple months back, the IRS released “Generic Legal Advice Memorandum 2020-004” — which addresses the timing of tax withholding on options, SARs and RSUs. A ...

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Companies Changing Incentive Compensation Plan Performance Targets or Metrics Due to COVID-19

Since executives, compensation committee members and executive compensation professionals began to recognize the havoc wreaked by COVID-19 on the performance targets and ...

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Dodd-Frank: A Decade In, Where Do We Stand on Rulemaking?

Last week marked the 10-year anniversary of President Obama signing the Dodd-Frank Act into law. The SEC continues to track its progress on the mandatory rulemaking ...

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Follow-Up on SEC Final Rules for Proxy Voting Advice Businesses

On Wednesday, I posted on the SEC’s Open Meeting to vote on new rules applicable to proxy voting advice businesses (“PVABs”), such as ISS and Glass Lewis proxy ...

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SEC Approves Final Rules to Reign in Proxy Voting Advice Businesses

Together with most executive compensation professionals, this blog has been closely following the multi-year saga of attempts by the SEC and Congress to reign in the ...

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Factors Impacting 2020 Say-on-Pay Vote Outcomes

A recent Mercer report shows 2020 proxy season say-on-pay vote results have been pretty stable — with support averaging about 91%. Even though the average vote result ...

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Negative Say-On-Pay: “Blood in the Water” for Activists

Today’s headline is based on an article from The Deal (subscription required), which highlights that negative say-on-pay votes send a signal to activists that ...

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NYC Comptroller Ramps-up Call for EEO-1 Diversity Data

We’ve blogged a few times about disclosure of EEOC data, in response to growing calls for transparency on diversity and pay equity. As Lynn blogged last week on our ...

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New Proposed Rules on Compensation Clawbacks Are High on the SEC’s Regulatory Agenda

As required by federal law, the Office of Information and Regulatory Affairs published the new Spring Regulatory Flexibility Act Agenda on June 30, including a short- ...

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Fall Shareholder Engagement: Prep Questions

Off-season shareholder engagement is always important, but this year it may be even more so with attention focused on social issues, company responses to the pandemic ...

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Trends in Mid-Cap Non-Employee Director Compensation

Back in May, I wrote about ClearBridge Compensation Group’s report analyzing trends in non-employee director compensation. ClearBridge recently issued a second report, ...

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Defer Annual Bonuses to 2021?

We’ve blogged before about annual incentive plans — recognizing that some companies are considering whether to exercise discretion at year-end when determining bonus ...

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Implementing Cost-Saving Measures: Non-Compete Considerations

A recent Akin Gump memo discusses considerations relating to non-compete agreements for companies that might be implementing cost-saving measures during COVID-19. ...

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Reading IRS Proposed Regulations on Employer-Provided Commuting in the Era of Pandemic and Civil Unrest

Today, a guest post from my partner Ruth Wimer. Last week, the IRS issued extensive proposed regulations addressing Qualified Transportation Fringes (QTF), as revised by ...

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Equity Grants: Administrative Checklist

A blog from Hunton Andrews Kurth’s Tony Eppert is a good one to keep on hand for whenever you’re making equity grants. Here are some of the reminders he ...

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Comp Committees: Time for a Greater “Human Capital” Role?

We’ve written a few times about the trend of compensation committees taking on a broader role — and held a webcast about it a couple of years ago. At our upcoming ...

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Tesla & ISS’s Excessive Director Pay Policy

Last year, Liz wrote about how ISS would analyze “outliers” for its voting policy on director pay. Under the policy, if ISS identified a company as having high ...

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Modifying Outstanding Equity: Is Repricing Back on the Table?

A recent DealBook article and FT analysis found that about 50 companies gave their CEOs 50% more options than last year — and although the grant size was due to ...

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ISS Illustrates How Compensation Committees Could Consider Adjusting Annual Incentive Goals in 2020

As we continue through this annus horribilis, last week, ISS announced that it will be providing “a series of potential frameworks Compensation Committees could ...

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Pay Ratio: COVID-19 Complications

With furloughs, layoffs and changes to executive and workforce pay, many companies’ 2020 pay ratio calculations are going to require some extra thought. A memo from ...

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IRS Provides Guidance on the Timing and Amount of Tax Withholding for Stock Awards

In May, the IRS released the Office of Chief Counsel Memorandum (the “Memo”) providing detailed guidance on the timing and amount of withholding and deposits for ...

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More on “Scrutiny of Executive Pay Continues”

Last week, I blogged about the scrutiny on executive compensation actions. A recent Pearl Meyer blog also urges caution, particularly when thinking about making an ...

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Stock Ownership Guidelines in Times of Market Volatility

For many companies, the precipitous drop in their stock price created situations where officers and directors subject to stock ownership guidelines, with which they ...

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CEO Pay Study Shows Smaller Increase from Prior Years

A recent Equilar blog reports that it, together with the AP, has released its annual CEO pay study. The study says total compensation includes information disclosed in ...

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Reducing Employee & Director Pay? Contractual Obligation Considerations

I’ve written before about reports we’re seeing of executive and director pay cuts. For companies thinking about potentially making pay cuts or salary reductions for ...

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Modifying Performance Goals & Plan Limitation Considerations

When considering whether to modify or substitute equity awards or executive compensation plans in response to economic fallout from the COVID-19 pandemic, a Proskauer ...

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Mandated ESG Disclosure Coming Soon to Your Proxy Statement?

Earlier this month, the Investor-as-Owner Subcommittee of the SEC’s Investor Advisory Committee (the “Subcommittee”) issued a Recommendation Relating to ESG ...

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Discretionary Pay Adjustments — Early Planning is Key

I’ve discussed before about the impact of COVID-19 and potential use of discretion in making adjustments to executive compensation. A recent Semler Brossy memo says ...

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Fluidigm’s Post-Employment Compensation Disclosure

While most companies devote a portion of their Compensation Discussion and Analysis to describing the reasons for providing severance and change in control payments and ...

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Jamie Dimon’s “Inclusiveness” Call to Action and Reorienting the Purpose of the Corporation to Serve All Stakeholders

In August 2019, the Business Roundtable (“BR”) created a stir with its Statement on the Purpose of a Corporation letter. Legendary economist Milton Friedman had ...

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Compensation Peer Group Evaluation During Crisis

Not to overload the compensation committee, but another item that companies may want to add to the committee’s agenda, if they haven’t already, is a review of their ...

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Vanguard’s View about Executive Pay During COVID-19

Recently, Vanguard issued its insight about executive pay during COVID-19. Vanguard’s general message is that directors should be guided by good judgment on critical ...

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Stock Ownership Requirements: Temporary Waivers?

Back in February, I wrote about recent trends in stock ownership requirements. Obviously, a lot has happened since then and a recent Hunton Andrews Kurth blog serves as ...

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COVID-19: Comp Committee Discussion Topics

For companies with May or June compensation committee meetings, they’ll undoubtedly be discussing company responses to COVID-19 and impacts to compensation. A Pearl ...

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Trends in Non-Employee Director Compensation

A recent report from ClearBridge Compensation Group takes a look at trends in non-employee director compensation. The report examines compensation for non-employee ...

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Compensation Committees and Human Capital Management – Get Ready for Your Close-Up

During these interesting times, each week I hope to tap out a blog or two of which I am not entirely ashamed. I have posted several times on the question of whether all ...

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COVID-19: Observations about Executive Compensation

A recent blog from Dan Ryterband at FW Cook serves as a reminder that the pay cuts we seem to read about daily for senior executives and non-management directors have ...

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J.P. Morgan Tightens Comp-Related Voting Policies

Changes to investor proxy voting policies and guidelines are common and recent changes to J.P. Morgan’s voting policies caught my eye as some changes relate to ...

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Kroger’s COVID-19 Disclosure

I was reading through the Compensation Discussion and Analysis in the definitive proxy statement of The Kroger Company yesterday and saw that they had added a section to ...

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Economic Volatility: Valuation Impacts

With continued economic volatility, companies also need to think about stock-plan valuation issues. Most companies haven’t had to deal with valuation-related ...

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Expect to See More Reporting in the “Bonus” Column of the Summary Compensation Table in 2021

We expect that the performance goals most compensation committees set for their executives’ annual incentive programs have been rendered null and void by the ongoing ...

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As You Sow “CEO Comp Report”

Earlier this year, shareholder proponent As You Sow issued its sixth annual “100 Most Overpaid CEOs” report; it’s available for download from their website. ...

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Follow-Up on Potential Alternative to Repricing Underwater Stock Options

A couple weeks ago, I wrote on SEC approval of the New York Stock Exchange’s request to provide temporary waivers of the shareholder approval requirements applicable ...

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Thinking of Reducing Director Equity Awards?

Recently, I wrote about a survey of Russell 3000 companies and the impact COVID-19 has had on executive and director pay. When making changes to director pay, cash ...

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More on “ESG & Compensation Plans: Proceed with Caution”

Recently, I wrote about how some say ‘proceed with caution’ when preparing to integrate ESG with incentive plans. There’s a helpful Sullivan & Cromwell memo ...

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Best Buy’s COVID-19 Disclosure

As we get deeper into the proxy season, more companies are addressing the effects of COVID-19 on their business, including in their proxy statement. Often the subject is ...

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Guide for Applying Discretion to Equity Awards

Use of discretion has been mentioned as a possible mechanism for dealing with equity awards granted earlier this year before COVID-19 became a pandemic, but it’s not ...

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A Potential Alternative to Repricing Underwater Stock Options?

With so many companies’ stock prices depressed, executive compensation professionals are talking about the possibility of stock option repricing. However, option ...

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COVID-19: Another Look at Initial Reactions to Executive Pay

Survey data seems to be coming out pretty regularly now as companies continue thinking about what to do with executive and director pay as uncertainty about the effects ...

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Pandemic Impact on Director Pay

I’ve written about results from a couple of Pearl Meyer surveys about the impact of the COVID-19 pandemic on executive compensation. With their most recent report, ...

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ESG & Compensation Plans: Proceed with Caution

Not long ago, I wrote about starting the conversation with the board on integrating ESG into executive compensation plans. As much as investors might be calling for ...

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COVID-19 Impact on Compensation Committee Oversight

Not long ago, I wrote about increased workloads for compensation committees. As issues related to the COVID-19 pandemic continue, a recent KPMG memo says investors are ...

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Pandemic Disclosures Begin to Appear in CD&As

Last week, Proxy Analytics and Soundboard Governance issued a reference guide for 2020 annual shareholder meetings and related SEC disclosure in light of the ongoing ...

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Temporary CEO Succession Planning

A recent Pearl Meyer blog discusses the importance of temporary CEO succession plans as we confront the COVID-19 pandemic. Among other things, the blog lists ...

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2020 Say-on-Pay Predictions & Early Results

A recent report from Semler Brossy includes predictions for the 2020 proxy season along with early vote results for say-on-pay, equity plan proposals and director ...

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Gender Pay Gap Proposals Continue

Last year, Liz wrote about gender pay gap proposals and how Citigroup was the first company to post unadjusted “pay gap” numbers on its website. Arjuna Capital and ...

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Another Take on “Unusual Executive Compensation Approach”

Not too long ago, I wrote about Meridian’s memo discussing the $1 CEO salary coupled with equity awards approach. As Frank Glassner from Veritas Executive Compensation ...

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ISS Issues Policy Guidance on the Impact of the COVID-19 Pandemic

Yesterday, ISS issued Policy Guidance on the Impacts of the COVID-19 Pandemic addressing the following issues:  Annual Shareholder Meeting Issues (i.e., ...

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Study: S&P 500 Use of ESG Metrics

We’ve blogged before about incorporating ESG metrics into incentive programs. Even though doing so can seem daunting, a recent report from Willis Towers Watson says ...

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J.C. Penney’s CD&A Highlights

The J.C. Penney Company. Inc. filed its latest definitive proxy statement yesterday. As a long-time customer (particularly in my youth), I was curious to see what ...

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Reporting Requirements for Waived or Foregone Compensation

You may have been reading about (and some may have facilitated) senior executives announcing that they will forego all or a portion of their salary, bonus or other ...

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More on “Addressing COVID-19 for Exec Comp Plans”

A couple of weeks ago, I wrote about implications and approaches to dealing with the effect of the COVID-19 pandemic on executive compensation plans. As companies and ...

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Executive Compensation and Other Restrictions under the CARES Act – TARP Redux?

According to news reports, Congress just approved a final version of the Coronavirus Aid, Relief, and Economic Security Act (H.R. 748) (‘‘CARES Act”) and sent it ...

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Consider Everything During Crisis

The coronavirus crisis and market volatility has left many wondering what they can do about compensation decisions made before the crisis ensued, and if they haven’t ...

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Love And Section 409A In The Time Of COVID-19

Everyone is talking and writing about the high-level issues of performance goal setting, equity award timing, option repricing and share pool problems, so I thought I ...

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Code Section 139 – Tax Free Aid To Employees

I hope readers are well. I have been minimizing blog posts lately, but I now plan on a few brief ones, not limited to executive compensation. Since COVID-19 was ...

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Honeywell’s Compensation Risk Disclosure

As I skim through various proxy statements each week, I rarely spend much time reading the compensation-related risk disclosures that are included in or follow the ...

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Addressing COVID-19 For Exec Comp Plans

COVID-19 is creating plenty of challenges for executive compensation programs. There are two recent memos, one from Semler Brossy and another from PwC, that discuss some ...

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Poll Results: COVID-19 & Exec Comp Plans

A new poll from Pearl Meyer shows that although most companies haven’t considered how the COVID-19 pandemic will impact executive compensation in 2020, many have ...

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EVA Metrics and Short-Termism

We’ve discussed before about ISS’ new EVA metrics that are being used in this year’s pay-for-performance analysis. Hopefully comp committees are looking at EVA ...

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Clawback Policies: Suggestions for Strengthening

Liz wrote earlier this year about how clawback policies may be turning restatements into a rare species. Recently I came across a memo from SF Magazine discussing why, ...

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Plan Participants Suing Over 409A Failures

The greatest risk from violations of the byzantine rules under Section 409A may not be from the IRS, but from the company’s own executives. I have written before on ...

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Unusual Executive Compensation Approach

With a depressed company stock price, senior officers at AMC Entertainment Holdings recently agreed to a new compensation approach for its executives. The approach ...

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HSR Thresholds Adjusted for 2020

Executive compensation professionals do not come across the Hart-Scott-Rodino Act often. However, it does come up in certain circumstances, as evidenced by the ...

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What to Write About 162(m) Deductibility in the 2020 Proxy

Inquiring minds want to know what to write about 162(m) deductibility in this year’s proxy statement. Just a short blog today to address this question. For ...

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Saving the Best for Last: CD&A Focus

Saving the best for last may sound good, but it can amplify stress levels when it involves proxy season. So, if you’re drafting the CD&A as the proxy statement ...

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Performance-Based Comp Considerations

A recent blog from Foley & Lardner lists 10 considerations for management and compensation committees when establishing performance awards. The blog includes ...

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Pre-IPO Peer Group Selection

Lots of considerations go into selecting a compensation peer group and proxy advisors tend to select peers based on industry, companies of similar size in terms of ...

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Relaxation of the Definition of “Control” Creates New Opportunities and Risks for Banking Organizations

On January 30, 2020, the Board of Governors of the Federal Reserve System adopted a final rule to revise the Board’s regulations related to determinations of whether a ...

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Hewlett-Packard Enterprise’s Director Compensation Disclosure

It’s been a slow week for proxy filings, which has enabled me to catch my breath before the 2020 proxy season really begins in earnest. And, while the filings ...

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New CECL Rules Suggest Review of Banking Organizations’ Incentive Compensation Plans

The new Current Expected Credit Losses (CECL) accounting standard was issued by the Financial Accounting Standards Board (FASB) as ASC 326 in June 2016.  Application of ...

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Comp Committees and ESG To-Dos

Liz wrote last fall about how one company was planning to tie executive compensation to elements of strategic ESG goals.  Shareholders continue to ask for standardized ...

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SEC Release on Key Performance Metrics Has Implications for Compensation Professionals Too

Last month, the SEC issued an interpretive release addressing Item 303 of Reg S-K (see Rel. No. 33-10751, Key Performance Metrics (2020)).  Although this guidance ...

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Reg G: Not Coming to a CD&A Near You?

As reported in this Reuters article, recent statements by Corp Fin Director Hinman say the SEC won’t be writing new rules to require public companies to explain why ...

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Update on the Ongoing Saga of the SEC Rules on Proxy Advisory Firms

Because I already have written three times on this ongoing saga, I wanted to provide an update.  Recall that in August 2019, the SEC voted 3-2 to publish interpretive ...

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How to Make CEOs Happy

Other than paying them well, what do CEOs want from us? It all comes down to knowing your audience – and with a CEO, that means tying all conversations back to ...

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Telling a Story About Director Pay

Not too long ago, Liz wrote about how director pay continues to attract more and more attention.  As director pay faces increased scrutiny from investors, a recent blog ...

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Engagement Disclosure Following Low Say-on-Pay Result

A recent Georgeson blog sheds light on disclosure of investor engagement practices after a company failed or received a “red zone” say-on-pay vote result. ...

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TSR vs. CEO Pay: Which Grows Faster?

There’s a lot of attention lately to the fact that CEO pay growth is outpacing the growth of “average” worker pay. Maybe if companies are moving away from ...

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Sonos’ Executive Compensation Highlights

As we begin to prepare for the upcoming proxy season, I find myself reflecting the evolution of the Executive Summary to the Compensation Discussion and Analysis and ...

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SEC Proposal to Update Accredited Investor Definition Has 162(m) Implications Too

In December 2019, the SEC voted to propose amendments to the definition of accredited investor, one of the principal tests for who is eligible to participate in our ...

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Clawbacks: Shareholders’ Continued Push for “Reputational” Triggers

Shareholders continue to scrutinize how clawback policies apply to situations of “reputational harm” – the latest examples coming in the form of shareholder ...

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Discretion and Performance-Based Pay under the New 162(m) Proposed Regulations

Today, we will discuss the vexing issue of annual or long-term incentive plans that were made before November 2, 2017, and that satisfied the performance-based ...

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Navistar’s Disclosure Graphics

Navistar International Corporation recently filed its definitive proxy statement for fiscal 2019, which includes a number of interesting tables and graphics in the ...

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High Pay Ratio Impacts Say-on-Pay…But “Spin” Won’t Help

A recent paper from three B-School Profs might confirm what many people in our community have been advising: don’t over-explain your pay ratio. The research also ...

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Fair Treatment for CFOs under the New 162(m) Proposed Regulations

Last month, I blogged on the new Proposed Regulations issued by IRS and the Treasury Department on the changes to Code Section 162(m) made by the Tax Cuts and Jobs Act ...

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Proxy Season: Compensation Considerations

Here’s some pay-related proxy season recommendations from Hunton Andrews Kurth’s Tony Eppert: Adopt an annual grant policy – this can act as an affirmative ...

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Failed Say-on-Pay? Simply Paying Less Isn’t the Answer

An Equilar blog summarizes the most common changes that companies make to their pay programs following a failed say-on-pay vote – the key is to emphasize pay for ...

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Great Western’s Director Compensation Disclosure

As we begin a new year, it’s always a little tricky to predict what the next 12 months will bring. As I’ve thought about what to expect in 2020 in the area of ...

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162(m): Proposal Would Limit Post-IPO & Transaction Deductibility

As Lynn discussed a few weeks ago, the IRS recently proposed regulations to implement changes to IRC Section 162(m) that are necessary under the 2017 Tax Cuts & Jobs ...

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Glass Lewis: Your Peer Group is Changing

On January 1st, CGLytics officially will become Glass Lewis’s exclusive global partner for its “pay-for-performance” modeling and grading system. As part of that, ...

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Small-Caps Jumping on “Pay-for-Performance” Bandwagon

Even as some investors might be cooling on “pay-for-performance,” there’s been an uptick in performance awards at smaller companies. A recent blog from Willis ...

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Expanding the Application of 162(m) Deduction Cap to Other “Publicly Held Corporations”

On December 17, I blogged on the new Proposed Regulations on the changes to Code Section 162(m) made by the Tax Cuts and Jobs Act of 2017.  Today, I will focus on just ...

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Proposed Regulations Clarifying Section 162(m)

Yesterday afternoon, IRS released Proposed Regulations on the changes to Code Section 162(m) made by the Tax Cuts and Jobs Act of 2017 (to be published in the Federal ...

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Personal Jet Use: “Hidden” Corporate Costs

We discuss quite a bit around here about private jets – it’s a “perks” quandary that keeps on giving. Here’s more proof of how tricky it can be: a recent ...

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CII’s Policy Overhaul: The Conversation Continues

A few months ago, Liz wrote about CII’s overhaul of its executive compensation policy – urging companies to reduce complexity of their incentive plans. Predictably, ...

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Buybacks & Equity Compensation: Match Made in Heaven?

Our friend Bruce Dravis recently sent us a note about his research on the complementary relationship between stock buybacks & equity compensation – and a related ...

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Gender & Racial Pay Gap: Intel Releases Detailed EEOC Data!

Yesterday, in addition to posting its annual “Diversity Report,” Intel made waves by also publishing on its website the pay data that it recently filed with the ...

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Starbucks Joins Citi to Disclose Gender & Racial Pay Gap

Last year, I wrote about Citigroup being the first US company to disclose its “unadjusted pay gap” – which compares the median earnings of women & minorities ...

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ISS Preliminary FAQs as to 2020 Compensation Policies

ISS has published its Preliminary Frequently Asked Questions as to Compensation Policies for 2020, as it does every year.  Generally, ISS publishes its “final” ...

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Cisco’s Perquisites Disclosure

Before we head into the long Thanksgiving holiday, I thought I’d follow up the post that I published last month about the perquisites offered to the directors (and ...

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Independent Security Studies Provide Tax Benefits and Protect Valued Executives

The Tax Cuts and Jobs Act of 2017 eliminated employers’ ability to deduct many fringe benefits and other business expenses, such as entertainment expenses, and reduced ...

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Incentive Plans: How They’re Looking

Here’s the highlights from FW Cook’s annual report on incentive plans: – Profitability and revenue measures are the most commonly used financial measures among ...

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Books & Records: Getting “Say-on-Pay” Info Isn’t Proper Purpose

Shareholders are increasingly sending a Section 220 “books & records” demand as a first step in derivative complaints – and companies need to tread carefully ...

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Director Pay: Delaware Chancery Deals Procedural Blow to Plaintiffs

Director pay has been getting more scrutiny lately – but a Skadden memo covers one procedural bright spot for companies. Here’s the intro: On October 30, 2019, ...

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But Wait! There’s More! SEC Proposes to Tighten Shareholder Proposal Thresholds

Because one highly controversial proposal wasn’t enough, the SEC also announced a rule proposal yesterday that would make it more difficult for shareholders to submit ...

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More on “CalPERS’ Say-on-Pay Policy: No More Second Chances?”

Last spring, I wrote that CalPERS was considering a change to its proxy voting guidelines that would result in it voting “against” compensation committee members in ...

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SEC’s “Proxy Advisor & Shareholder Proposal” Proposals Coming Next Week?

Although we haven’t yet seen a Sunshine Act notice from the SEC, the Financial Times is reporting that the SEC could propose new rules for proxy advisors & ...

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Evolving “Compensation Committees”: What’s in a Name?

A memo from Willis Towers Watson says that compensation committee names & charters are starting to reflect issues that investors say they care about. Here’s some ...

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Say-on-Pay: ISS Endorsement No Longer a “Golden Ticket”

Today’s blog falls in the “be careful what you wish for” category. A recent FTI memo says the diminishing influence of proxy advisors may be contributing to lower ...

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“Realizable Pay” Could Be Making a Comeback – But The Devil’s In The Details

Disclosure of “realizable pay” seems to be less prevalent these days than it was when say-on-pay first hit the scene. But as I wrote a few months ago, ISS is ...

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5 Steps for Tying Executive Pay to Sustainability

Last week, Clorox announced that it will tie executive pay to elements of strategic ESG goals – it’s the most recent of a few big-name companies to do so. Whether ...

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“Pay” Shareholder Proposals Gain Traction

Here’s the key takeaways from the ISS proxy season review: – Increase in say-on-pay opposition: The number of say-on-pay votes receiving less than 70 percent ...

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SEC Settles Nissan Fraud Charges: Don’t Have the CEO Set Their Own Pay!

We have written a couple of times over the past year about the SEC’s Nissan investigation, which (among other reasons) is of interest because Nissan is a Japanese ...

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Executive Pay: CII Policy Overhaul Says to “Get Back to Basics”

From time to time, people question whether “pay-for-performance” is all it’s cracked up to be – and now you can add CII to its list of skeptics. The Council of ...

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M&A Conflicts: Court Says Undisclosed CEO Comp Discussions Potentially Material

John Jenkins recently blogged about the Chancery Court’s decision in In re Towers Watson & Co. Stockholder Litigation, (Del. Ch.; 7/19), in which Vice Chancellor ...

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How to Prepare for a “Gender Pay Gap” Proposal

I’ve blogged that activist shareholders have no intention of dialing back their “gender pay gap” efforts, and that shareholder support might be increasing. In ...

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Executive Pay: Still A “Lightening Rod” For Shareholders

Lazard recently hosted a director forum – which also featured SEC Commissioner Rob Jackson and representatives from Whitegate Partners, Wellington and CalSTRS – to ...

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Big Banks (Still) Answering to Congress for Big Pay Ratios

The House Committee on Financial Services is continuing to use pay ratio disclosure to hone in on human capital management issues at big banks. Yesterday, Committee ...

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Glass Lewis Going “All In” With CGLytics…And Considering Pay-for-Performance Changes

As I wrote in June, Glass Lewis is now using CGLytics (instead of Equilar) for compensation & data analysis of North American companies. According to a Georgeson ...

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How Did Say-on-Pay Fare This Year?

We’ve added an excellent analysis from Sullivan & Cromwell to our batch of reports indicating how pay fared on the ballots this proxy season at annual meetings. ...

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Private Company Director Pay: Meeting Fees Still Common

A recent survey of 600 private companies showed that 72% pay an annual retainer to directors – and 54% pay a per-meeting fee. That’s according to an article from ...

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Enhanced Scrutiny of Director Pay: Most Companies Aren’t Worried

Director pay is coming under more scrutiny due to ISS policy changes and recent Delaware cases. But according to a Pearl Meyer survey, most companies are ...

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Avoiding an IPO Trainwreck: Comp Issues

There are unique challenges to working with companies preparing for an IPO – especially if management and/or the board don’t have much public company experience. In ...

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CEO Stock Ownership: “Skin in the Game” vs. Voting Control

Even as CEOs are paid millions of dollars in stock awards each year, the majority of Russell 3000 CEOs control less than 1 percent of the companies they work for, and ...

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Executive Pay As a Way to Advance Diversity Efforts

Here’s an excerpt from an interesting piece from Semler Brossy’s Todd Sirras about how the design of pay can influence the diversity of a company’s ...

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Pay Ratio: A Missed Opportunity to Explain Material Changes Between Years

Here’s an excerpt from a piece by Deloitte Consulting’s Mike Kesner: One might have expected to see an explanation of material changes in a company’s CEO pay ...

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Are Your Noncompete Agreements Dying of Old Age?

Here’s an excerpt from an Akin Gump piece: Legal developments and changes in an employee’s job or the nature of the company’s competition can cause ...

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Human Capital Management: Defining the Compensation Committee’s Role

Recently, Mike Melbinger gave some reasons why compensation committees should expressly take on the responsibility of human capital management. A memo from Willis ...

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162(m) Is Gone, But What About Similar State Laws?

Yes, way back in 2017 the Tax Act eliminated Internal Revenue Code Section 162(m) – the “qualified performance-based compensation” exception for deductible ...

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Incentive Plans: Handling the Impact of Acquisitions

A Willis Towers Watson memo gives suggestions for handling annual, long-term and deal-related incentives at an acquiring company. Here’s an excerpt: One of the ...

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Proxy Advisors: An Updated Set of “Best Practices”

Last week, a group of proxy advisors released an updated set of “best practices for proxy advisors.” These “best practices” were first issued in 2014. Here’s ...

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Performance Awards: Are We Reaching the Apex?

According to a recent Equilar report, CEO pay continues to grow – with median total compensation increasing by 8% since 2017. It also identifies this notable ...

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CEOs Got Pay Hikes Twice That of Workforce

An article from CBS News notes the discrepancy between the overall CEO rate of pay inflation and the pay rate of ‘typical’ worker. I imagine this type of media ...

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Using ‘Weighted Average Cost of Capital’ to Test Performance Targets

Here’s a suggestion from this Pay Governance memo by John Ellerman: The weighted average cost of capital (WACC) is an important financial precept that is widely ...

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Say-on-Pay: Shareholder Policies Getting More Complex?

I’ve blogged that most companies will experience a say-on-pay failure at some point. This PJT Camberview memo says that might be because voting policies have become ...

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Buybacks: A Scapegoat for “Short-Termism”?

The Pay Governance memo analyzes the relationship among stock buybacks, long-term growth and executive compensation for companies in the S&P 500. Here’s the ...

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What’s the “Latest Practicable Date” for S-4 Comp Tables?

Some of us have been internally debating what the “latest practicable date” means for purposes of S-4 compensation disclosures. There often are public-public deals ...

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Why Equity Mix Matters

The CEO pay mix has been shifting to include more full-value stock awards and fewer stock options. A CFO.com article – which is based on this 2017 research – says ...

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Private Company Equity Awards: Recent IPOs Reveal Trends

A blog from myStockOptions.com looks at innovations in private company awards that help ease tax obligations, which – notwithstanding new(ish) Internal Revenue Code ...

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Paying for “The Right” Performance

A recent survey of 250 directors – conducted by Corporate Board Member & Compensation Advisory Partners – offered these key findings about performance ...

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How ISS Looks at “Realizable Pay”

The ISS FAQs for its compensation policies say (Question 27) that research reports show realizable pay as compared to granted pay – and that realizable pay may be ...

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Clawbacks: Hertz Sues Former Execs For $70 Million Based on “Tone at the Top”

If your company has to restate three years of financials due to some bad accounting decisions, who pays for the fallout? In a still-rare move, Hertz recently filed ...

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Say-on-Pay: Triggers for State Street “Abstentions”

Last week, State Street Global Advisors posted “key takeaways” to remind everyone about the circumstances that could trigger it to abstain from a say-on-pay ...

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Gender Pay Data: EEOC Reporting Now Required

Earlier this year, I blogged about the relationship between “gender pay” shareholder proposals and a handicapped rule that would have required companies with more ...

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More on “Regulation G: Coming to a CD&A Near You?”

Last week, I blogged that SEC Commissioner Rob Jackson wants the SEC to require explanations & reconciliations when non-GAAP numbers are used in the CD&A. ...

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Wachtell Lipton’s “Compensation Committee Guide”

The latest guide for compensation committees from Wachtell Lipton is here (which includes sample compensation committee charters for NYSE & Nasdaq companies in the ...

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Regulation G: Coming to a CD&A Near You?

SEC Commissioner Robert Jackson recently co-authored a WSJ opinion piece calling for increased transparency about the use of non-GAAP numbers in setting executive pay. ...

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