Compensation Committees: “Human Capital” Agenda Items

Over the past couple of years, we’ve been tracking the trend of compensation committees expanding their scope of focus to cover the broad spectrum of human capital ...

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Pay Ratio: Complex “Median Employee” Calculations Leave Investors With a Bad Taste

Liz blogged a couple of months ago about how investors are starting to assess pay ratios as part of the say-on-pay analysis. According to a recent study by a group of ...

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This Year’s Emerging Compensation Trends

To kick off 2022, here’s a summary of Longnecker’s blog covering upcoming compensation strategies & emerging trends – for executives and the broader ...

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Perks: Should the Comp Committee Approve Them Every Year?

As everyone plots out the agendas for upcoming board & committee meetings — and considers governance disclosure that will go in the proxy statement — a member ...

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Say-on-Pay: Canadian Investors Considering “Pay Disparity” Factor

The Canadians are sorry, but some of them have had enough of excessive CEO pay at U.S. companies. As investors to the north and elsewhere begin to incorporate ...

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FW Cook’s “Top 250 Report”

FW Cook has released its 49th Annual “Top 250 Report,” which examines the long-term incentive practices and trends of the 250 largest companies in the S&P 500. ...

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Clawbacks: Former CEO Returns $105 Million for “Misconduct”

While many folks were hard at work on year-end deadlines — or taking well-deserved breaks — there was a big development in the clawbacks space. McDonald’s ...

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Projecting Workforce Base Salary Increases in 2022

I previously blogged about compensation committees using discretion in incentive plans to retain executives through the pandemic. But with the spotlight on human capital ...

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Compensation Lessons Learned from Two Years of the Pandemic

Due to the COVID-19 pandemic, some compensation committees had to use their discretion with incentive plans to retain and motivate executives. While investors and proxy ...

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Equity Compensation Plans: S&P 500 Share Utilization Trends

Willis Towers Watson’s Global Executive Compensation Analysis Team (GECAT) found some equity compensation program trends for S&P 500 companies by analyzing the ...

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CD&A: Start Drafting the Difficult Parts Now

A blog from Pearl Meyer’s Sharon Podstupka points out that it’s not too soon to begin drafting your CD&A — particularly if your comp committee changed ...

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Stock Ownership and Retention Guidelines: S&P 100 Getting More Stringent

A recent Willis Towers Watson memo looks at how S&P 100 stock ownership and retention guidelines have changed over the past six years. Here’s an excerpt from the ...

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Tips on Handling Equity When Your Executives Retire

With the amount of annual compensation that executives earn, some people think that retirement benefits aren’t much of a competitive factor. However, a Meridian memo ...

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Practical PSU Pointers for Compensation Committees

Liz recently blogged about ISS’s updated FAQs on pandemic-related pay adjustment. It looks like investors are steadily expecting companies to go back to pre-pandemic ...

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BlackRock’s 2022 Executive Compensation Policies: Director Accountability for Pay-for-Performance

On Tuesday, Blackrock Investment Stewardship released its 2022 Investment Stewardship Global Principles and its updated U.S. proxy voting guidelines, which are effective ...

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Visa’s Perquisites Disclosure

As we now get closer to the end of the year, the proxy statement filings are really starting to lighten up. In my experience, that’s fairly customary around the ...

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Linking Executive Pay to Climate Transition: 34-Page Guidebook

Recently, Willis Towers Watson partnered with the World Economic Forum’s Climate Governance Initiative to publish a 34-page guidebook on whether and how to use ...

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ISS Updates FAQs on Pandemic-Related Pay Adjustments

Yesterday, proxy advisor ISS published updated “FAQs” for pandemic-related pay adjustments. This six-page document refines the FAQs originally published in October ...

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Dynamic Market Conditions Could Affect Your Compensation Peer Group

As a FW Cook blog highlights, a few unique dynamics are making it more challenging than usual to ensure that your compensation peer group remains accurate: – ...

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Guidewire Software’s Say-on-Pay Response

At its last annual meeting of stockholders, Guidewire Software, Inc. only received support for its named executive officer compensation from just over 57% of the votes ...

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Congress Hones In On Pre-Bankruptcy Executive Bonuses

A Bloomberg Law article reports on a recent House bill, “No Bonuses in Bankruptcy Act of 2021,” introduced by Rep. Cheri Bustos. The article notes that while ...

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Glass Lewis ’22 Voting Guidelines: Robust Disclosures Are Key for E&S Metrics and Incentives

On Monday, Glass Lewis announced the publication of its 2022 Policy Guidelines. As always, the first few pages of the Guidelines summarize the policy changes for 2022. ...

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CEO & CFO Compensation: 600 Mid-Market Companies

Take a look at BDO’s latest study examining CEO & CFO compensation plans and pay levels of 600 middle-market public companies. Data was collected from proxy ...

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Refresher: Accounting for Stock Compensation Under ASC 718

For all of us securities lawyers who didn’t major in accounting, FW Cook published a 13-page primer covering the most pertinent provisions of accounting for stock ...

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The Greenbrier’s Shareholder Engagement Disclosure

The rail freight car manufacturer, The Greenbrier Companies, Inc., filed its definitive proxy statement yesterday. Even though they’re not connected, ever since I had ...

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Peer Groups: ISS Window Opens Monday

Yesterday, ISS announced that for companies with annual meetings between February 1 and September 15 of next year, its peer group review and submission window will open ...

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Insurance Companies: Accounting Change May Affect LTIPs

Insurance companies are facing a new accounting standard for “long-duration contracts” that will go into effect for fiscal years beginning after December 15 of next ...

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19th Annual “Executive Compensation” Survey: Data on “Clawback Policies”

The annual “Corporate Governance & Executive Compensation Survey” of the 100 largest companies from Shearman & Sterling is out! Last year, I blogged about ...

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ISS’s Proposed Policy Changes: No Big Changes Previewed for Voting on U.S. Pay

Late last week, ISS released 33 pages of proposed benchmark policy changes. Companies, investors and others can submit comments on the proposals until 5 pm ET next ...

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Clawbacks: Can They Preempt State Labor & Employment Laws?

Liz recently blogged about the SEC reopening the clawback policy comment period (on Day 3 of our recent conferences no less!) — as a reminder, the 2015 SEC clawback ...

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Unintended Consequences of Benchmarking Pay: Female Executives Are Stuck At the Median

Public companies like peer benchmarking. It gives lots of great datapoints for compensation committees to use while setting executive pay. But benchmarking also leads to ...

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Activision CEO’s “Total Comp” Now Entirely Linked to Gender Diversity Goals

Late last week, Activision CEO Bobby Kotick sent all employees an email that was also posted as news on the company’s website. After detailing steps the company is ...

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2022 Proxy Season: Reminders for Upcoming Comp Committee Meetings

A Winston & Strawn blog recaps the multitude of issues you need to be thinking of as you plan for upcoming compensation committee meetings, fall engagements and ...

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ESG Metrics: Bigger Problems If You Get It Wrong

There are a lot of reasons to proceed with caution when adding ESG metrics to your incentive plan. A Compensation Cafe blog from Altura’s Ann Bares suggests that the ...

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ESG in Incentive Plans: No Going Back?

FW Cook recently posted preliminary findings from a study of ESG metrics in incentive plans, based on disclosures through September 15th. The prevalence of quantitative ...

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Director Compensation: Outliers Are Rare

An Equilar blog says that — despite some companies freezing director pay during the pandemic — retainers have continued to steadily increase by about 1.9% the past ...

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Glass Lewis Launches Equity Plan Advisory Service

I’ve been curious about the direction of Glass Lewis since it was reported earlier this year that they were being acquired by a private equity firm. Yesterday, the ...

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Stock Compensation: Don’t Forget HSR Filing Requirements

A Sullivan & Cromwell memo gives a good reminder about monitoring director and officer stock acquisitions to ensure they don’t trigger a filing under the ...

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Clawbacks: SEC Reopens Comment Period!

The writing was on the wall when the SEC scheduled and then cancelled this week’s open meeting. Yesterday, without a meeting, the Commission announced that it was ...

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SEC Open Meeting Tomorrow! Re-Open “Clawbacks” Comment Period?

As I blogged last week on TheCorporateCounsel.net, just in time for our “Proxy Disclosure & Executive Compensation Conferences” — where our agenda includes a ...

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CFO Pay: 2020 Levels Stayed Basic

A 7-page memo from Compensation Advisory Partners looks at how 2020 CFO pay compared to CEO pay, based on 135 companies with median revenue of $12 billion. As you might ...

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CEO Pay in the S&P 1500: Growing, But at a Slower Rate

Willis Towers Watson recently announced results of their 2021 study on CEO pay in the S&P 1500. Here are the key findings, by the numbers: – 4.7% – Increase ...

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ISS Policy Survey Results: Lots of Support for a Longer-Term Pay-for-Performance Screen

On Friday, ISS announced the results of its 2021 benchmark policy survey. 159 investors responded — as well as 246 companies, advisors and affiliates. Here are some of ...

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SEC Proposes Enhanced “Say-on-Pay” Voting Disclosure for Institutional Investment Managers

Yesterday, the SEC announced that it had proposed amendments to the rules governing disclosure of proxy voting by mutual funds and institutional investment managers. ...

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ESG Metrics: Examples of “Carbon Reduction” in Pay Plans

I’ve blogged that it’s somewhat rare right now for companies to link executive pay to environmental metrics. Now, the non-profit shareholder advocacy organization As ...

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Democrat’s September 2021 Tax Proposal Would Directly Affect Executive Compensation

The tax increases and spending legislation proposed by Democrats in September 2021 would apply the deductibility limits of Code Section 162(m) to more employees and ...

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Director Compensation: Pay Freezes Could Soon Thaw

A memo from Compensation Advisory Partners looks at non-employee director compensation among the largest public companies. Here are the key takeaways for this ...

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HSR Filing Failure Trips Up Another Corporation/Executive

Executive compensation professionals do not often come across the filing requirements of Section 7A of the Clayton Act (15 U.S.C. § 18a, commonly known as the ...

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Dems Float Federal “Pay Ratio” Tax

I’ve blogged a few times about “pay ratio” tax proposals — mostly at the state level. Although they haven’t really taken off, a CNBC article and other sources ...

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ISS’s Compensation Proxy Season Review: Director Pay Disclosures Are Improving

ISS recently released its “Compensation 2021 Proxy Season Review.” The full report is available only to corporate and institutional subscribers — but here are the ...

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Say-on-Pay: Responsiveness & Engagement Getting Even More Important

A 16-page Sullivan & Cromwell memo gives a nice overview of voting results for say-on-pay and equity plan proposals through June 30th. The memo also gives tips for ...

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Do Proxy Advisory Voting Businesses Actually Help Their Clients?

In case you missed it, I wanted to draw readers’ attention to a post last month “Proxy Advisors: Do Their Clients Cast Informed Votes?” on our sister site ...

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Say-on-Pay: Big Companies Are Facing More Scrutiny

The latest Semler Brossy recap of say-on-pay results says that results this year are a mixed bag. From a trend perspective, S&P 500 companies seem to have more to ...

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Shareholder Litigation: Pandemic “Spring Loading”?

Here’s something that my colleague John Jenkins blogged recently on TheCorporateCounsel.net: We’ve previously blogged about COVID-19 related securities litigation, ...

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“Mega Grants”: How to Get Stakeholder Buy-In

You might’ve thought that executive “mega grants” disappeared a decade ago, along with new episodes of Jersey Shore. But a Pearl Meyer memo says they could be ...

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ESG Incentives: Industry Differences

There’s no “one size fits all” with ESG metrics. They have to be carefully tailored to support the specific ESG strategies and priorities that the board has ...

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CEO Pay: More About Ego Than Buying Power?

The capuchin monkey experiment is often trotted out as an example of how pay inequity demotivates employees. If we’re anything like the monkey in the experiment, ...

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Private Co’s: Secondary Markets Could Make Employee Equity More Valuable

I’ve blogged before about resale restrictions on equity awards to private company employees, but it’s been a few years. Trading in pre-IPO shares has taken off since ...

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ISS Annual Policy Survey

Last week, ISS opened its “Annual Benchmark Policy Survey.” As the name implies, this is only a survey, a series of questions that ISS uses to gauge its clients’ ...

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ISS Policy Survey: ESG Metrics, Longer-Term Pay-for-Performance Screen, and Mid-Cycle Pandemic Adjustments

As I blogged last week on TheCorporateCounsel.net’s Proxy Season Blog, ISS has opened its “Annual Benchmark Policy Survey,” as well as a separate “Climate Policy ...

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Shareholder Proposals: Proponents Losing Interest in Comp Topics… Except “Environmental Performance Metrics”

Although only 7% of shareholder proposals this year have related to executive pay (and none have passed), proposals for compensation linked to environmental performance ...

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ISS Expands its Discussion of Problematic Pledging of Company Stock

Last week I wrote on ISS’s April update to its U.S. Procedures & Policies (Non-Compensation) FAQ, focusing on changes to ISS’s policy on stock ownership ...

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Changing Nature of Work: What’s the Comp Committee’s Role?

With a tight labor market and executives and employees reconsidering the “nature of work” as we know it, compensation committees are now dealing with much more than ...

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ISS Revises Its Rules on Company Stock Ownership Guidelines and Pledging

Way back in late April, ISS updated its U.S. Procedures & Policies (Non-Compensation) FAQ. Generally, ISS publishes its proxy voting guidance in November or ...

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Europe: ESG Metrics Could Become Mandatory for “Sustainable” Investments

Under the EU’s existing “green taxonomy,” economic activities that meet certain conditions will be incentivized as “environmentally sustainable” investments ...

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Equity Compensation After Delisting or Uplisting

Most clients intuitively understand that delisting — or uplisting — will affect equity compensation plans, but forward-thinking advisors will also take a moment to ...

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IRS Releases Updated Nonqualified Deferred Compensation (409A) Audit Technique Guide

Last month, the Department of the Treasury Internal Revenue Service released an updated Nonqualified Deferred Compensation Audit Technique Guide. IRS had last released a ...

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Looking Back at Company Responses to Low Say-on-Pay Vote Results

As the dust settles from this year’s annual meeting season, in the weeks ahead we’ll likely start hearing of company plans and potential strategies in response to ...

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Connection Between Pay Levels and Low Say-on-Pay Vote

A recent Equilar blog takes a look at 2021 say-on-pay vote results so far, and like other memos and reports, Equilar projects that 2021 could see the highest failure ...

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ESG Metrics: Beware “Unintended Consequences”

In the past year, S&P 500 companies rapidly changed their executive compensation to incentivize diversity, worker health and safety, and other ESG metrics. In some ...

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Pay-for-Performance: Not Just Broken, But Actively Causing Harm?

Food for thought: Pay-for-performance tanks productivity, creates a risky compliance culture, causes undesirable conflicts among departments, is only useful for tasks ...

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Peer Groups: ISS Window Opens Next Tuesday, Equilar’s Closes Tomorrow

‘Tis the season…for updating off-season peer groups. ISS announced yesterday that their peer group submission window will be open from 9 am ET on Tuesday, July 6th ...

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SEC Says Employee Manual’s Whistleblower Restriction Violates Exchange Act

Last week, I blogged on TheCorporateCounsel.net that the SEC has issued a record amount of whistleblower awards this year. Companies need to anticipate the possibility ...

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Anterix’ ESG Disclosure

Anterix, Inc. is a New Jersey-based wireless communications company engaged in delivering broadband needed to modernize infrastructure for energy, transportation, ...

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Pay-for-Performance Doesn’t Always Please Everyone

In an unusual twist, last week a company announced voting results from its annual shareholder meeting and said it considered all items of business with the exception of ...

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Highest-Paid CEOs: 2020’s “Top 10” Are Nearly All New to The List

As we cross the high-point of proxy and annual meeting season, Equilar and the New York Times recently released their annual look at CEO pay levels for the 200 ...

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At the Forefront in the Battle Over Compensation Clawbacks

I have written several times on companies’ efforts to clawback, and shareholders’ attempts to force a clawback of, executives’ compensation as the law in this area ...

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Perceived ESG Missteps Can Affect Pay Votes Too

A recent Glass Lewis blog looks at what can go wrong with ESG oversight — and how it can connect to, and impact, executive pay votes. The situation discussed in the ...

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ESG Metrics: European Co’s Could Foreshadow U.S. Trends

A recent Pay Governance Survey of 30 big UK and EU companies shows that nearly all of them have included ESG metrics in their incentive plans — compared to about 20% ...

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Activist Investors Complain That “Pay-for-Performance” is Juicing Pay Ratios

A NYT article analyzes whether execs are receiving outsized stock awards that end up widening the gap between CEOs and ordinary workers. It focuses on the 200 ...

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ESG and Executive Pay: Example of “Supply Chain” Metrics

An online fashion retailer out of the UK is linking executive pay to improvements in supply chain workers’ rights in response to government pressure to do so. Although ...

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Unfortunate Result in a Termination for Cause Case

A March 2021 opinion by the United States District Court for the Southern District of Ohio, Dix v. Atos IT Solutions & Servs., Inc., provides a surprising and very ...

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Director Pay Programs: Observations and Potential Changes to Watch

ESGAUGE, The Conference Board and Semler Brossy recently issued a director compensation report reviewing trends and developments at Russell 3000 and S&P 500 ...

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ISS Vote Recommendation Impact: 2021 Vote Results and Trends

Back in March, I blogged about a report summarizing say-on-pay vote outcomes over the past 10 years, along with data showing the potential impact of proxy advisor vote ...

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Another Rendition to Expand Scope of Compensation Committees

Last summer, Liz blogged about suggestions to broaden the role of the compensation committee to focus on the company’s workforce as a whole. For a recent rendition of ...

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ESG Metrics: Don’t Bite Off More Than You Can Chew

We continue to post resources in our “Sustainability Metrics” Practice Area that can help you navigate the best way to link ESG goals to executive pay. Caution and ...

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The SEC Introduces Uncertainty for Investors and Corporations, and Their Advisers

I return to blogging after some time off to scuba dive with news of an unfortunate turn of events at the SEC. I have posted several times over the last decade on the ...

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Private Company Director Cash Compensation: Some Pay Retainers, Others Pay Meeting Fees

With more companies searching and competing for diverse and talented directors, private companies are revisiting director pay plans to ensure they’re competitive. A ...

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Looking Forward: 2021 Incentive Design Trends

Over the last year, we’ve blogged about changes to executive pay programs in response to COVID-19. For a peek at where things are headed in 2021, Meridian recently ...

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Roadmap for Communicating IPO Equity Compensation

Liz blogged not too long ago about market practice for stock incentive plans and employee stock purchase plans for companies going public. A recent blog from Sharon ...

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Low Say-on-Pay Vote Result: A Plan to Demonstrate Responsiveness

Liz has blogged about some of the early trends with this year’s say-on-pay votes. Although a proposal hasn’t technically failed when it receives support from ...

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Say-on-Pay: Is “Rubber Stamping” Over?

The last five years of say-on-pay data show that approval levels have gradually been dropping, according to an Equilar blog. Here’s the intro: Marking its 10th ...

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What’s Driving Lower Say-on-Pay?

Semler Brossy’s latest say-on-pay recap (from Thursday, May 13th) reports that the current failure rate is 3.3% for Russell 3000 companies — meaning 22 have failed ...

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#MeToo & Severance: Company’s “Cause” Definition Prevails

On Friday, ViacomCBS reported on a Form 8-K that the $120 million disputed severance payment to former CEO Leslie Moonves would revert in its entirety to the company. ...

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Working Remote: Most Companies Keep Comp “As Is” for Employees Moving to Lower-Cost Areas

As comp committees are often tasked with human capital management oversight, for some this oversight can include matters relating to remote work arrangements and return ...

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AllianceBernstein Wants to See ESG Linked to Pay & Outlines “Best Practices”

AllianceBernstein recently released a report summarizing its “2020 ESG Engagement Campaign” and it says one of its two most important ESG themes in 2020 was the ...

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Linking ESG to Pay: Considerations for Incorporating into Long-Term Incentive Plans

Earlier this year, Liz blogged about trends among Fortune 200 companies linking diversity & inclusion metrics to executive pay. When we’ve seen reports of ...

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Early Say-on-Pay Voting: BlackRock’s Votes “Against” Increase

Liz blogged last week about early say-on-pay vote results and as of late April, the failure rate was 2x higher than at this time last year. Annual meeting season can ...

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Rule 10b5-1 Trading Plans in the News

It seems like the media turns a spotlight on Rule 10b5-1 Plans every few years. I have posted on 10b5-1 Plan issues more than ten times in the last 10 years alone (see, ...

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Say-on-Pay: The Reckoning Continues

Wow. The latest Semler Brossy memo tracking say-on-pay results for this season, which was published last Thursday. Three takeaways jump out: – The current failure ...

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COVID-19: Many Companies Adjusting Annual Incentives

Compensation Advisory Partners recently analyzed COVID-related pay actions of 300 companies in the S&P 1500 with a December 31st FYE. Although it’s a somewhat ...

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Pay Gap Proposals: What Leads to ISS Support

ISS recently published updated “Policies & Procedures FAQs” – and #113 explains how the proxy advisor evaluates “pay gap” shareholder proposals. Here’s ...

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Company Engagements Lead to Slowdown in Pay Equity Proposals

Over the last year, we’ve blogged about shareholder proposals dealing with racial & gender pay equity – there’s an entry about Arjuna Capital’s continued ...

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Glass Lewis Report: More S&P 500 Companies Linking D&I Metrics to Comp Programs

Over the last year, we’ve blogged a few times about companies announcing inclusion of diversity metrics in executive compensation programs – there’s an entry about ...

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Tips for Linking Employee Engagement to Executive Pay

As companies begin linking diversity, equity and inclusion metrics to certain elements of executive pay, in a recent NACD blog, Robin Melman and Christina Andersen of ...

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Alphabet/Google Almost Links Executive Compensation to ESG Metrics

I have posted several times on corporations’ recent efforts to link executives’ compensation to ESG, HCM and DE&I. [Note that, if you want current, practical, ...

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Cybersecurity & Benefit Plans: DOL Issues Guidance for Plan Sponsors & Fiduciaries

Periodically, Liz and I have blogged on TheCorporateCounsel.net about cybersecurity risk and it seems unusual to blog about cybersecurity risk here on ...

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Large Investors Are Adding “Sustainability” to Executive Pay Voting Frameworks

A new 49-page analysis (download required) from SquareWell Partners looks at how proxy advisors & large investors are evolving their approach to climate change. Here ...

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More on “Say-on-Pay: Is 2021 the Year of Reckoning?”

A WSJ article says median CEO pay reached $13.7 million last year and is on track for a record. While a good number of investors seem to appreciate that retaining good ...

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Director Compensation: A Baby Step Into Bitcoin

Last week, MicroStrategy – a small-cap company that trades on the Nasdaq Global Select Market – filed a Form 8-K to announce that its four independent directors will ...

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Legal & General Increased 2020 Comp Engagements & Votes “Against” Pay

Over on the “Proxy Season Blog” for TheCorporateCounsel.net members, I blogged about Legal & General’s 2020 “Active Ownership Report.“ The report ...

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Trillium’s Say-on-Pay Voting Policy Sets a High Bar

Some may recall that in addition to “traditional” proxy voting guidelines issued annually by ISS, the proxy advisor also issues “specialty” proxy voting ...

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More on PBCs – Publicly Traded Corporation Converts to a Public Benefit Corporation

On Monday, I posted on Developments in the “Public Benefit Corporation” Space, discussing education tech company Coursera’s IPO as a Public Benefit Corporation ...

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Looming Challenge: Potential Rising CEO Pay Ratio

A recent blog post on the HLS Corporate Governance Forum from Dan Marcec of Equilar provides some early CEO pay trend data. Data cited in the blog is based on proxy ...

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Developments in the “Public Benefit Corporation” Space

On March 31, education tech company Coursera went public [IPO] as a Public Benefit Corporation (“PBC”) [NYSE: COUR]. Its shares closed up 36% at $45 (from $33). ...

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Litigation over Aspirational or Generic Disclosures on DE&I

I have written about corporations’ recent efforts to improve DE&I by the one method most likely to produce improvements: linking executive compensation to ...

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Is Pay Benchmarking Making CEOs Apathetic?

You hear quite a lot in this space about CEO pay levels ratcheting up due to peer benchmarking and every company wanting to pay “above median.” A recent academic ...

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Special Issues for SPACs

One cannot look at financial and business news lately without seeing one or more articles on SPACs (special purpose acquisition company). Not wanting to miss-out on the ...

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Equity Incentive Plans: Return of “Evergreen” Provisions?

I blogged a couple of weeks ago about pre-IPO equity incentive plan practices. Recent research from ISS Governance Solutions reinforces the finding that evergreen ...

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Insight on State Street’s Say-on-Pay Abstentions & “Against” Votes

On the heels of State Street issuing its 2021 proxy voting and engagement guidelines that Liz blogged about last week, the asset manager also issued its 2020 stewardship ...

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Incorporating D&I Metrics in Pay Programs? Consider These Items First

We’ve blogged a few times about use of D&I metrics in incentive plans – here’s an entry about use among Fortune 200 companies. As stakeholders continue with ...

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Succession Planning Under the Fed Guidance for Large Financial Institutions

Last week I posted on Supervisory Guidance on Board of Directors’ Effectiveness issued by the Board of Governors of the Federal Reserve System, which is not just for ...

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Fed Guidance for Large Financial Institutions

Last month the Board of Governors of the Federal Reserve System (the “Fed”) issued Supervisory Guidance on Board of Directors’ Effectiveness, that applies to all ...

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New Checklist! “How-To” for ESG Metrics

A Gunster blog reports that about half of S&P 500 companies used ESG metrics in their annual cash incentive plans last year. Based on the number of company ...

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Say-on-Pay: Is 2021 the “Year of Reckoning”?

According to a WSJ article and data from ISS Corporate Solutions, only 10 S&P 500 companies have had shareholders reject annual say-on-pay resolutions in the last ...

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Compensation in the Time of COVID – Starbucks’ Shareholders Vote Down Its SSOP Proposal

Just a few weeks ago, I highlighted Starbucks’ commendably specific linking of executives’ incentive compensation to Diversity, Equity, and Inclusion (DE&I) ...

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Precisely How Might Companies Consider Tweaking their Definition of Change in Control Based on Recent Federal Court Decision

Last Friday,* I posted on a federal court decision on whether a change in control had occurred under the terms of a company’s Executive Severance Agreement plan ...

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Companies Might Consider Tweaks in their Definition of Change in Control Based on Recent Federal Court Decision

In November 2020, A federal court in the Northern District of Illinois (Chicago) evaluated whether a change in control had occurred under the definition of the ...

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10-Year Look at Say-on-Pay Vote Outcomes & Proxy Advisor Impact

Now that say-on-pay has been on annual meeting ballots for 10 years, Compensation Advisory Partners issued a report summarizing the voting results. Although support has ...

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CIC Arrangements Study: Cash Severance Multiples Trend Down

During proxy season, one disclosure topic that some follow relates to potential payments upon termination or change in control. Earlier this year, Meridian Compensation ...

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Rule 701: 5 Things the SEC’s Proposal Could Change

Who knows whether the changes that Rule 701 amendments that the SEC proposed last fall will go anywhere. But if they do, the recent blog from Dan Walter gives a nice ...

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SPACs: The Fast-Moving Comp Process

Love the “Compensation Cafe” blog from Dan Walter about how to prepare for the compensation aspects of a fast-moving SPAC deal: Once you are brought into the ...

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Proposed “Stimulus” Legislation Would Extend the Limits of 162(m) Even Further

Bad news. The proposed American Rescue Plan legislation would further expand the definition of covered employee under Code Section 162(m) to include even more highly ...

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Work-from-Anywhere: Possible Step to Improve Pay Equity?

Through the last year, the COVID-19 pandemic forced many companies to shift to remote-work options. Streaming service Spotify recently announced it’s moving to a ...

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ESG & Incentive Plans: Considerations for Moving Forward Cautiously

I blogged last month about global trends relating to incorporation of ESG metrics into incentive plans. In another study, FW Cook examined use of ESG measures in annual ...

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COVID Pay Adjustments: Early Look at ISS’s Assessment

I blogged a couple of weeks ago about one potential proxy season theme and another might be how investors and proxy advisors view 2020 COVID-related pay actions. A ...

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Furloughed Employees: CEO Pay Ratio Considerations

It’s been a while since we’ve blogged about the potential impact of COVID-19 related complications for CEO pay ratio calculations and disclosures. A Freshfields blog ...

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The Case for Awarding Equity to All Employees

The recent push to spread employee stock ownership by Pete Stavros, co-head of private equity for the Americas at KKR, seems to have received a lot a press lately. ...

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Another Perks Enforcement Action!

Yesterday, the SEC announced it had settled charges against a gas exploration & production company and its former CEO for failing to disclose $650,000 worth of ...

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Executive Compensation Linked to Diversity, Equity, and Inclusion (DE&I) Goals

Readers expressed unusually high interest in one of last week’s blogs, McDonald’s Puts Its Executives’ Money Where Its Mouth Is on HCM and D&I, so I thought I ...

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Peer Groups: Getting to “Yes”

A one-page checklist from Semler Brossy is great because it acknowledges that your peer group can’t please everyone – but there are still ways to identify one that ...

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Linking ESG to Executive Pay: Sample Engagement & Disclosure Questions

The International Corporate Governance Network recently issued a 10-page memo on integrating ESG into executive compensation plans. Consistent with what we’ve been ...

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McDonald’s Puts Its Executives’ Money Where Its Mouth Is on HCM and D&I

Yesterday, McDonald’s Corporation filed a Form 8-K, announcing the details of the payout structure for its 2021 Target Incentive Plan (“TIP”) awards for ...

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Conserving Cash: About that Bonus…

We’ve blogged before about studies showing executive pay actions in response to the pandemic. Recently, CG Lytics, the data service provider to Glass Lewis for the ...

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2020 Banner Year? Considerations for Setting 2021 Incentive Goals

In a recent Directors & Boards article, Blair Jones and Greg Arnold of Semler Brossy discuss incentive goal setting amid the pandemic. Uncertainty about the ...

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CEO Pay Increase Trends & Projections

Throughout the year, and particularly this time of year when many companies dole out bonuses, many keep a watchful eye on CEO pay. A recent Pay Governance memo takes a ...

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Clawbacks and Holdbacks

After a short break following my retirement from Winston and Strawn and the practice of law, I’m back in the thick of things, writing for CCR Corp and exploring ...

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Arjuna Continues Push for “Unadjusted Pay Gap” Disclosure

Last week, Arjuna Capital announced that it had withdrawn a racial and gender pay equity reporting resolution at BNY Mellon – following the bank’s agreement to ...

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Next-Gen “Clawbacks”: Mandatory Deferrals

Despite pressure on boards to broaden clawback policies and seek payback in the event an executive causes “reputational harm,” companies have to fight an uphill ...

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Measuring D&I Outcomes: Opportunities to Improve

Liz blogged last fall about the Business Roundtable’s statement encouraging voluntary public disclosure of key diversity metrics. In the statement, the BRT also called ...

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Effectiveness of Retention Grants: More of a Near Term Impact

One aspect of CEO succession that you don’t read a lot about is the effectiveness of steps taken to help ensure retention of other senior leaders. To help limit ...

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Proxy Season Theme? Linking Pay to Sustainability Progress

A few things come to mind when thinking about possible themes for the 2021 proxy season and one could involve companies linking executive pay to progress on ...

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Incorporating Stakeholder Measures: What Weighting Do Companies Use?

We continue hearing more about how companies are incorporating ESG metrics into incentive programs – earlier this week, I blogged about Marathon Oil’s changes to its ...

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Glass Lewis Details Its COVID-19 Pay Analysis

Yesterday, Glass Lewis issued new details on its approach to executive pay in the context of COVID-19. The proxy advisor hasn’t changed its executive pay framework – ...

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“Human Capital” Questions for Comp Committees

As we’ve talked about on this blog before, express board oversight of “human capital” is becoming more common – and it frequently falls to compensation ...

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Director Pay: “Annual Limit” Trends

Willis Towers Watson recently published its annual analysis of director pay levels and practices among S&P 500 companies. As I’ve previously blogged, arrangements ...

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Economic Challenges: May be Time to Revisit Change in Control Provisions

Looking back at 2020, compensation committees ended up addressing a lot of issues resulting from COVID-19. As the economic effects continue, a recent Ogletree Deakins ...

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Time-Vested Restricted Stock: Some Companies Opting for Simplification Amid COVID-19

We’ve blogged before about CII urging companies to reduce complexity of their incentive plans. One positive outcome from simplifying incentive programs is that it also ...

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EIP Disclosure: Awards for Past Accomplishments

A Stinson blog gives a timely reminder to be careful in your proxy disclosures when seeking shareholder approval of your equity incentive plan. In Pascal v. Czerwinski, ...

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Clawbacks: A Roadmap for Decision-Making

The WSJ reported last week that General Electric’s board decided not to claw back pay to former CEO Jeff Immelt and other executives. They had been considering that ...

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Director Refreshment

Just a quick post today to highlight a couple of other posts on board of directors refreshment by friends and fellow bloggers Lynn Jokela and Liz Dunshee. Lynn’s post, ...

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D&I Metrics in the Fortune 200

I’ve blogged a couple of times about companies announcing that they’re planning to link diversity metrics to executive pay. A Semler Brossy memo captures the trends ...

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“Reputational Harm” Clawbacks: Shareholders Press for Board Turnover, Including Comp Committee Chair

About a year ago, I blogged about shareholders that were scrutinizing how clawback policies apply to situations of “reputational harm.” At the time, the NYC ...

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Using ESG as a Modifier for Annual Bonuses

I blogged earlier this week about a Willis Towers Watson survey that showed over the next several years we’ll likely see an increase in how companies use ESG metrics ...

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Mid-Cap Annual & Long-Term Incentive Comp Trends

Before the end of the year, I blogged about incentive compensation trends for large-cap companies. ClearBridge Compensation Group recently issued a companion report ...

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Tying ESG to Compensation: Shift Toward More Sustainable Metrics?

Liz wrote last summer about how most ESG metrics that are incorporated into incentive plans relate to shorter-term operational metrics rather than long-term ...

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Realizable Pay Disclosures: Not Helping Your Say-on-Pay?

Before you dive into crafting your next supplemental proxy disclosures about “realizable pay,” check out a recent study from ISS Corporate Solutions — suggesting ...

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ISS Updates FAQs for Compensation Policies and EPSC Evaluations in 2021

I did not want to post any more blogs this year, but last week, ISS posted its Compensation Policies; Compensation Policies; Frequently Asked Questions; and Equity ...

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Executive Chair Compensation: How Different is it from CEO Pay?

Compensation of an executive chairperson isn’t a frequent discussion point when reading commentary about board structure. The debate about board leadership structure ...

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Hot Off The Presses! Final Regulations Under Revised Section 162(m)

Of course, we all know that nothing says Merry Christmas and Happy Holidays like regulations from the IRS. And that is just what the executive compensation professionals ...

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Director Pay: 15% of Companies Temporarily Cut Retainers

A 29-page memo from FW Cook analyzes 2020 director pay at 300 companies of various sizes and industries. Here’s what it says about the pandemic’s impact on board ...

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Woodward’s COVID-19 Disclosure

Most of the proxy statements I’m looking at these days include some level of disclosure about the coronavirus pandemic (and not just in the context of why the company ...

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Bankrupt Company’s Deferred Compensation Plan Funded by a Rabbi Trust — What Could Go Right? Hint: It’s Not 409A

Like many restaurant chains, Ruby Tuesday was devastated by the dining out restrictions imposed in light of the COVID-19 pandemic. Ruby Tuesday filed for bankruptcy ...

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A “Quasi-Clawback”: Ain’t That The Truth!

A couple months ago, Goldman Sachs announced that it intended to recover $174 million in compensation of current and former employees, following its $2.9 billion ...

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2020 Say-on-Pay Naysayers

Following a review of N-PX filings, a recent Proxy Insight memo provides an overview of 2020 proxy voting disclosures. The memo includes a discussion (see pages 4-5) of ...

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Helpful Resources on Human Capital Management, Including a New Practice Area Now Up On CompensationStandards.com

Just a brief note today. I now have posted several times on the SEC’s new human capital management disclosure requirements, but readers’ responses suggest that many ...

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COVID-19 Pay Adjustments: Factors to Help Determine Most Appropriate Actions

We’ve blogged before about different reports summarizing COVID-19-related pay actions. As companies take different actions that range from adjusting metrics to ...

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Carve Out Time to Reflect on Compensation Philosophy

As many companies continue to struggle with fallout from the pandemic, questions abound about how companies will deal with 2021 goal setting and whether companies will ...

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Adobe Becomes Latest Company to Disclose Pay Gap

We’re continuing to see commentary on pay gap disclosures, and the most recent being a press release from Arjuna Capital announcing Adobe has become the fourth Fortune ...

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Follow-Up on “Section 409A Meets 162(m) and Some Plans and Agreements May Need to be Amended”

Readers asked a few questions about last week’s post on Section 409A Meets 162(m) and Some Deferred Compensation Plans and Agreements May Need to be Amended by ...

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Gender Pay Equity: Latest Twist for Diversity-Focused Derivative Suits

Yesterday, I blogged about the possibility that the SEC’s recent amendments to Rule 14a-8 could eventually deter proponents from submitting “pay gap” proposals. ...

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Will Rule 14a-8 Amendments Slow Down “Pay Gap” Proposals?

According to the investors on our recent webcast, “Pay Equity: What Compensation Committees Need to Know,” pay equity is going to continue to be a hot topic. But an ...

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Section 409A Meets 162(m) and Some Deferred Compensation Plans and Agreements May Need to be Amended by December 31

As readers know all too well, Code Sec. 162(m) limits the amount that a publicly traded company can deduct for payments to a “covered employee” in any year to ...

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D&I Pay Targets: Best as a Downward Modifier?

I blogged a couple months ago that Starbucks would be tying executive pay to diversity targets. Around the same time, Medtronic released its 2020 Integrated Performance ...

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Recent Posts You May Have Missed

As I should have anticipated, I received a very significant percentage of out-of-office bounce-backs last week during the Thanksgiving holiday. Therefore, I thought I ...

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COVID-19 Pay Adjustments: Detailed Disclosure Can Help Maintain Say-on-Pay Support

We’ve blogged before about how compensation committees are considering whether to use discretion to adjust executive pay in response to fallout from the pandemic. Many ...

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SEC Proposes Temporary Rules to Facilitate Participation by Certain “Platform Workers” in Compensatory Offerings Under Rule 701 and Form S-8

I really didn’t want to post another blog before Thanksgiving, but today the SEC voted 3-2 to propose rules that, on a temporary basis and subject to conditions, would ...

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Large-Cap Annual & Long-Term Incentive Comp Trends

ClearBridge Compensation Group recently came out with its report reviewing annual and long-term incentive plan trend data for large-cap companies. The report reviews ...

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Likely Priorities of the SEC in 2021

Last Thursday, November 19, the SEC adopted amendments to “Modernize and Enhance Management’s Discussion and Analysis and other Financial Disclosures.” Nothing ...

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Executive Compensation Policies: What’s “Standard” Now

This 27-page memo from ClearBridge Compensation Group looks at how executive compensation policies have evolved at 100 S&P 500 companies over the last decade. It ...

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Stock Option Controls: A Cautionary Tale

As if the folks at Eastman Kodak weren’t having a hard enough year already, the Form 10-Q that the company filed last week disclosed that five former executives made ...

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ISS Clarifies Approaches to Highly Paid “Independent” Directors & Pay Gap Proposals

ISS has released its 2021 proxy voting guidelines, which are effective for meetings on or after February 1st. As my colleague John blogged on TheCorporateCounsel.net, ...

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FAQs on Human Capital Management Disclosure

I have blogged before on the explosion of HCM onto the scene. With the SEC reporting season approaching rapidly, and in light of the new SECs disclosure requirements, ...

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Using Equity to Conserve Cash: Tips for Doing So Safely

With volatile economic conditions, some companies have been looking for ways to conserve cash, and some have considered worker pay cuts and layoffs. As an alternative, a ...

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Evolution of Tech Sector Director Comp

We’ve blogged about trends in director pay — both for mid-cap and large-cap companies. A Compensia memo reviews trends in technology sector director pay. The memo ...

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Another Look at ‘Early Filer’ Incentive Pay Decisions

Last week, Liz blogged about FW Cook’s analysis of compensation decisions from S&P 1500 companies with early fiscal year ends (April-June of this year). A ...

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San Francisco’s New Pay Ratio Tax

In August, I blogged about the San Francisco ballot initiative — Proposition L — that would impose a tax on companies doing business in the city if a company’s ...

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Pay Equity and Other Internal Assessments and Information — Don’t Forget the Attorney-Client Privilege!

Corporations and other employers conduct a variety of internal studies, and sometimes investigations, to ascertain whether they are achieving their standards or goals or ...

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Bankruptcy Retention Awards: COVID Giving a Reprieve From Scrutiny?

As we brace for a possible surge in Chapter 11 filings due to the pandemic, a memo from Compensation Advisory Partners suggests that some shareholders might be more ...

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Pandemic-Based Discretion: Proceed With Caution

A FW Cook blog analyzes FYE compensation decisions that have been recently disclosed by S&P 1500 companies whose fiscal years ended in April-June of this year. Here ...

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