The Administration’s announcement that it intends to proposed legislation that would give shareholders an annual advisory vote on executive compensation at all public companies is the just the latest indication that Say on Pay may be required during the 2010 proxy season. Here’s a summary of the origin and recent experiences with advisory votes on executive pay to help you get up-to-speed on this significant development.
Two pending corporate governance initiatives – a majority voting standard for the election of directors and a rule permitting large shareholders to nominate their own director candidates using the company’s proxy materials – are poised to dramatically alter director accountability for their actions and decisions, including those involving executive compensation.
The current economic downturn is exposing the vulnerabilities of traditional long-term equity incentives, such as stock options and RSUs. In this report, we discuss “stock price” performance shares, an alternative equity vehicle that overcomes many of these problems while providing strong motivation and retention incentives.
Here’s the latest information on companies that have sought shareholder approval for their stock option exchange program—a condition precedent that many companies must satisfy before conducting an exchange.
RiskMetrics Group (the parent company of Institutional Shareholder Services (ISS)) has updated its U.S. corporate governance policies for the 2009 proxy season, including several policies that affect executive and equity compensation matters.
Implementing a performance-based equity plan raises several challenging issues. One that is often overlooked is the potential disposition of awards in the event that the granting company is acquired during the performance period. This article summarizes the various approaches that are used to address the treatment of awards upon a change in control and evaluates their relative strengths and weaknesses.
The Emergency Economic Stabilization Act of 2008 imposes significant executive compensation and corporate governance standards on financial institutions that participate in the government’s Troubled Assets Relief Program. Here’s a summary of these new standards, and our assessment of the impact that they are likely to have on other companies in the months ahead.
With the recent volatility in the equities market, the stock prices at many technology and life sciences companies are at or near all-time lows; making them attractive targets for an unsolicited takeover bid. Here’s a process for evaluating whether your change-in-control program is meeting your objectives in this uncertain environment.
Many companies are facing significant levels of underwater stock options due to the recent volatility in the stock market. We offer a roadmap for evaluating whether an option exchange program is the best response to this unsettling development.
As activist shareholders step up their efforts to get companies to implement advisory votes on executive compensation, here’s what you need to know about Say on Pay.
ISS Governance Services (formerly Institutional Investor
Services, and now a part of RiskMetrics Group) has updated its U.S. corporate governance policies for the 2008 proxy season, including
several policies that affect executive and equity compensation matters.
RiskMetrics, Inc. (the former Institutional Shareholder Services) is the first major shareholder advisory firm to publicly disclose its reaction to the first proxy season under the SEC’s new executive compensation disclosure rules, and to propose for discussion a set of disclosure best practices to guide future filings.
The SEC’s Division of Corporation Finance has issued its long-anticipated report summarizing its observations on the first proxy season under the Commission’s new executive compensation disclosure rules. Companies should find the report to be helpful in preparing their upcoming Compensation Discussion and Analysis and related tabular disclosure.
A look at key parameters and current market trends, as companies who have not taken action in the past to restructure their underwater options face the prospect of recognizing an expense for awards that may unlikely provide any value to employees.
