Executive Pay Matters

May 17, 2013

The IRS recently issued its final report with respect to the agency’s college and university compliance project. Colleges, universities and other tax-exempt organizations will want to review the report to be sure their procedures for setting executive compensation are in line with the IRS findings and observations.

Stephen Douglas and Bill Kalten

May 16, 2013

With just over a quarter of Russell 3000 companies reporting their 2013 say-on-pay results, we’re getting a clearer picture of shareholders’ impressions of executive pay in 2013 and, as in prior years, the results to date suggest positive news. Our latest say-on-pay update examines a number of factors that have contributed to enhanced shareholder support this year, including how companies responded to receiving below-average support in years past.

Jim Kroll, Robert Newbury and Jessica Yu

May 10, 2013

In mid-April, the Church of England launched its new policy on executive pay. The Church holds a substantial portion of its £8 billion assets in equity and the new voting guidance is being used to support its voting this season.

Katharine Turner and Dan Perrett

May 9, 2013

In seven months, a significant provision of the Patient Protection and Affordable Care Act will take effect. Boards and senior leadership need to better understand the likely impact health care reform will have on their employees, their customers and their organization so they can make sure they are asking the right questions of their senior HR leaders.

Linda Caldwell, Helen Friedman and Jane Jensen

May 7, 2013

Towers Watson’s review of recent proxy statements shows that the growth in median CEO compensation in the technology industry slowed in 2012 and, in fact, trailed the broader market. However, CEO pay at the upper quartile of the tech sector continued to grow significantly.
Jacob O’Neill and Todd Lippincott

May 3, 2013

While TSR is clearly important, it’s more of an outcome than a driver of company performance. As I discussed in a recent workspan TV interview, we’re encouraging companies to take a more tailored approach to LTI design to ensure that their incentive programs reflect the company’s specific business strategies and drivers of long-term performance.
Andrew Goldstein

April 29, 2013

As public companies hold their annual meetings and shareholders weigh in on how executives are compensated, the governance of compensation programs looms large. Recently, I facilitated a question-and-answer session with a group of senior Towers Watson consultants about the governance trends and changes they’re seeing in their client work in the 2013 proxy season.
Jim Kroll

April 25, 2013

As companies continue to refine their executive compensation strategies for a shifting business landscape and closer shareholder scrutiny in the say-on-pay era, one key goal is ensuring a close link between executive pay and company performance. There are various ways to define pay and performance that are useful to consider in setting the overall pay strategy and measuring the effectiveness of pay programs on an ongoing basis.
Steve Kline and Todd Lippincott

April 24, 2013

Many of our clients are working to respond to the proxy voting policies of Institutional Shareholder Services (ISS), which for many companies has included an outright ban on any stock pledging by executives. Our view is that the ISS pledging policy goes too far because many companies read it as zero tolerance for any pledging whatsoever.

Marshall Scott and Steve Seelig

April 22, 2013

We can all agree on the criticality of ensuring that you have strong shareholder support and demonstrating that your executive compensation program is aligned with shareholders. But it’s equally important to ensure that your program and reward opportunities are well understood by participants.
Sharon Podstupka and Todd Lippincott