Our Insights

Engaging Shareholders on Pay

Recent results on say-on-pay votes suggest that, at times when shareholders become unhappy with executive pay programs, boards are sometimes caught unaware. This lapse seems to happen for a couple of reasons: oftentimes board members don’t visit shareholders themselves to hear about pay concerns. Read more

Key Considerations for Comp in M&A

Many companies are again pursuing mergers and acquisitions (M&A) after several years of a relatively quiet market. A key element of making a merger or acquisition work is getting the compensation program right. Pay related to M&A generally has two stages: developing compensation for key employees in both the acquired company and the acquirer leading up to the deal and developing ongoing programs after the deal closes. Read more

Pay Practices For Developing C-Suite Talent

In the best-run companies, CEOs and directors take considerable care in developing high-potential leaders. The best-run companies also make sure that compensation decisions and other rewards support leadership development efforts. To avoid sub-optimizing the performance of a talent-development system, companies need to build their systems from the ground up with pay and other non-financial rewards in mind. Read the entire article (PDF) written by Seymour Burchman and Blair Jones. Read more

A Cautionary Tale for New Compensation Committee Members

New directors bring fresh perspectives that contribute to a healthy discussion of all aspects of a business, including compensation, and often challenge the status quo (a notion which can be both good and bad). However, where compensation is concerned, directors would be well advised to look before they leap. This article provides a cautionary tale for companies with well-intentioned directors who may not appreciate that the changes they desire may be more suited to cultures they had known in the past. Read more

Adjusting Comp Goals “After the Fact”

Goal setting for executive incentive plans is generally a difficult proposition. In many situations, it would be desirable to have the flexibility to adjust plan targets automatically on an “after-the-fact” basis if the actual operating environment deviated significantly from the company’s original budgeting and planning assumptions. This article lays out an approach for automatically adjusting plan targets in a prescribed manner and illustrates the approach with a case study based on one of our clients. Read more

Righting the Say On Pay Ship

One of the positive outcomes of the Say on Pay provision in the Dodd-Frank legislation has been more regular dialogue between companies and shareholders. But to date, many companies have engaged with shareholders only after shockingly low votes. This article by Seymour Burchman and Blair Jones explores our recommendation - that companies should begin a dialogue with investors and proxy advisors well before pay concerns arise. This engagement can help avoid the distraction and other consequences of low Say on Pay vote results. Read more