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.
In 2004, the Securities and Exchange Commission’s (SEC) Division of Investment Management issued letters to two proxy advisory firms, Egan-Jones Proxy Services and Institutional Shareholder Services (ISS), that assured mutual fund managers they could rely on the vote recommendations of the two firms. On September 13, 2018, the SEC Investment Management staff decided to rescind the two letters. Continue reading →
Robert J. Jackson, Jr. is a new member of the United States Securities and Exchange Commission (SEC), having been appointed by President Trump in January 2018. Commissioner Jackson previously served as a New York University School of Law professor, where he taught in the areas of corporate law, corporate governance, corporate finance, and executive compensation. Continue reading →
On September 21, 2017, the Securities and Exchange Commission (SEC) released additional guidance on the CEO pay ratio disclosure requirement. While many had hoped for some form of delay or outright reprieve from the required disclosure, it is now evident that the SEC expects companies to fully comply with the reporting requirement in early 2018 when the rule becomes effective. Continue reading →
If current legislation and SEC rulemaking stand, one big story in public company executive compensation during the 2018 proxy season will be the disclosure of the “CEO Pay Ratio.” Beginning for reporting periods starting on or after January 1, 2017 (spring 2018 proxy filings), companies will be required to disclose the median of employee pay excluding the CEO, CEO pay, and the ratio between the two. Continue reading →
Spring is in the air, and executive compensation consultants are busy reading a cascade of public filings and proxy advisor reports as we analyze and are asked to predict trends in executive pay in 2017 and beyond. One of the most common questions in executive compensation this year concerns what will become of the Dodd-Frank mandated CEO pay ratio set to be disclosed publicly for most companies beginning with proxies filed in 2018 – if not delayed or overturned beforehand. Earlier this year, acting Securities and Exchange Commission (SEC) Chair Michael Piwowar took the unusual step of requesting additional comments on the cost and burden of complying with the already approved CEO pay ratio rule, which would require companies to disclose the ratio of CEO pay to that of the median employee. Continue reading →
In recent years, the SEC has developed extensive rules and regulations regarding the reporting of executive compensation in the company annual proxy. Such reporting includes the narrative discussion of CD&A executive compensation policies and practices as they pertain to the CEO and NEOs. Additionally, the SEC requires that companies provide numerous prescribed tables and schedules reporting the historical elements of executive pay for the most recently completed fiscal year as well as the past 2 fiscal years. Continue reading →
Perhaps the most controversial rule regarding executive compensation in the Dodd-Frank Financial Reform legislation is the CEO pay ratio disclosure. This rule requires disclosure of the CEO’s pay to that of the company’s median employee. The SEC adopted final rules regarding the pay ratio disclosure requirement in calendar year 2015, and the requirement is scheduled to take effect with proxies filed in 2018. Continue reading →
July 23, 2015 New analysis finds that the SEC’s recently proposed pay-for-performance proxy disclosure requirements may force companies to display a pay-for-performance misalignment that is incorrect. To read the full press release, click here.
The Securities and Exchange Commission (“SEC”) staff has had a busy summer. Following the release of proposed rules and regulations regarding the CEO Pay for Performance and Clawback provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”), the SEC on August 5, 2015 proposed final rules and regulations regarding the CEO pay ratio disclosure. The CEO pay ratio disclosure fulfills a further mandate of the Dodd-Frank legislation. Continue reading →
On April 29, 2015, the SEC released proposed rules on public company pay-for-performance disclosure mandated under the Dodd-Frank Act. Pay Governance has analyzed the proposed rules and the implications for our clients’ proxy disclosures and pay-for-performance explanations to investors. To … Continue reading →
2017 Leading Minds of Compensation, East featuring Diane Lerner, Managing Partner at Pay Governance
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.