Pay Governance LLC is an independent firm that serves as a trusted advisor on executive compensation matters.
Our work helps to ensure that our clients' executive rewards programs are strongly aligned with performance and
supportive of appropriate corporate governance practices.
Last month, Institutional Shareholder Services (ISS) released its 2018 voting policy updates for companies that have shareholder meetings on or after February 1, 2018. More recently, ISS revised its “Pay-for-Performance Mechanics” white paper, providing additional details on its 2018 policy changes, and updated its Frequently Asked Questions documents for both U.S. Compensation Policies and U.S. Compensation Plans. As many companies prepare for the upcoming proxy season, we are providing insight and additional guidance in navigating the latest ISS policy developments. Continue reading →
With the introduction of say-on-pay (SOP) in 2011 and the increased clout of proxy advisory firms on executive compensation program designs, the performance share unit (PSU) has become a common feature of executive long-term incentive (LTI) programs among U.S. public companies. Continue reading →
Say on Pay (SOP) and shareholder advisor vote recommendations have caused a dramatic increase in the use of relative total shareholder return (TSR) as a long-term incentive (LTI) plan performance metric. Continue reading →
Since advisory Say on Pay (“SOP”) votes became effective in 2011, ISS and Glass Lewis have exerted significant influence over the vote outcomes for these proposals. These advisors use quantitative tests to assess CEO Pay for Performance (“P4P”) alignment and supplement those quantitative assessments with a qualitative review of pay practices/program design. Continue reading →
In the Dodd-Frank Act legislation after the 2008 Financial Crisis, the inclusion of shareholder SOP voting was driven by bipartisan Congressional support to “control executive compensation…” at corporations. In 2009, a former SEC chief accountant said, “Executive compensation at this point in time has gotten woefully out of hand… The time to adopt ‘say on pay’ type legislation is certainly past due.” Politicians, regulators, and some institutional shareholders clearly thought that, “The impetus for passage of Dodd-Frank’s say-on-pay requirement in 2011 focused on remedying ‘excessive’ CEO pay.” Continue reading →
In today’s environment, with annual Say on Pay (SOP) votes, intense external scrutiny and the need to strongly align pay with performance, it is increasingly important for companies to be confident in their executive pay program. The foundation of a sound executive pay program is built on the company’s business strategy and talent needs, which, collectively, must be achieved in order to create shareholder value. Continue reading →
Agenda published their 2nd Quarter publication and included quotes from Aubrey Bout and Steve Pakela of Pay Governance. “One of the best parts of say on pay is shareholder engagement,” says Aubrey Bout, a partner with Pay Governance. “That is … Continue reading →
The vast majority—98%—of companies have passed their annual say on pay votes (SOP) over the past four years. Proxy advisor voting recommendations remain highly influential on these votes, and many companies, perhaps hundreds, have changed the structure of their executive pay programs to try to comply with proxy advisor policies and to obtain a “FOR” SOP vote recommendation from proxy advisors. Continue reading →
As companies approach the upcoming proxy season, Say on Pay (SOP) once again becomes top of mind for Compensation Committees and corporate management. Over the past 4 years since SOP proposals became mandatory under Dodd-Frank, shareholders have continued to show overwhelming support for executive pay packages despite continued criticism by media and other outlets. Continue reading →
A new Equilar report featuring commentary from Pay Governance and Donnelley Financial Solutions analyzes the compensation discussion and analysis (CD&A) section of S&P 100 proxy statements over the last five years. With the average CD&A reaching nearly 10,000 words, the report revealed key strategies in how companies design and communicate pay practices by using alternative pay graphs, checklists and other visualizations that help draw investors to the most important information.
To be redirected to Equilar and download a copy of this important report, click here.
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October 4, 2016
Pay Governance Adds New West Coast Partner
Matt Quarles has joined the firm as a Partner. In this role, Quarles is responsible for working with clients across industries on a wide range of executive compensation issues. He will be based in Los Angeles and has nearly 20 years experience in the executive compensation consulting industry.
Pay Energy®, a new proprietary assessment tool developed by Pay Governance
Pay Energy®, a new proprietary assessment tool developed by Pay Governance LLC, helps companies consider the “drive, discipline and speed” inherent in current programs and in alternative designs that may be evaluated.
“The fundamental philosophy of executive compensation is to ‘attract, retain and motivate’ a talented management team. So it’s concerning when you hear incentive awards are just put in desk drawers until plans mature,” said Pay Governance managing partner John England.