Say on Pay

Behind the Numbers

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Our "Behind the Numbers" series offers insights into Say on Pay success. Semler Brossy consultants answer questions about what SOP data really means.

Understanding the Impact of ISS’ Multiple of Median Test on Say on Pay Vote Support

Our weekly Say on Pay research consistently demonstrates that vote support is, on average, meaningfully lower (28%) when Institutional Shareholder Services (ISS) recommends “against” an issuer’s Say on Pay proposal. And, while ISS will conduct a thorough qualitative review before issuing an “against” recommendation, we know that ISS’ three quantitative tests are used as a preliminary screen to determine the level of qualitative scrutiny applied. Read more

Behind the Numbers: What Can a Smaller Company do to Protect its Say on Pay Vote and Have Larger Vote Improvement?

In last year’s Behind the Numbers post titled “Are the Companies Failing Say on Pay in 2013 Smaller than Prior Years?”, we investigated whether companies that failed Say on Pay with less than 50% vote support were smaller than in prior years. We found that companies with revenue below $500MM were in fact failing at a higher rate. In this post, we further the analyses done last year to understand whether this observation holds true in 2014. Read more

Behind the Numbers: Size and Say on Pay

We have been tracking Say on Pay votes since they became mandatory in 2011. One of the things we’ve sensed in 2013 is that companies that are receiving less than 50% support for the vote feel like they’re smaller than in years past. In this post, we have done further analysis to understand whether or not this sentiment is true. Read more

Behind the Numbers: A Reversal of Fortunes — Understanding the Factors that Drive a Significant Reduction in Support from One Year to the Next

Receiving strong support for Say on Pay in one year is certainly no guarantee for future Say on Pay success. While only a small percentage of companies see a significant reduction in support from one year to the next, the low frequency of this event belies the significant risk companies may face if they become too complacent in their approach to Say on Pay. In this article we examine the factors that drive a reversal of Say on Pay fortunes so that companies may be better prepared to address potential vulnerabilities. Read more

Behind the Numbers: Are shareholders targeting financial companies?

Our weekly Say on Pay report often raises interesting questions about what the data really mean. These questions are addressed in this series. Since the financial crisis, it seems like scrutiny of executive pay has been greater and shareholder sentiment has been more negative at financials compared to other industries. Interestingly, as of June 12, companies in the GICS Financial sector received some of the highest support of any industry. Read more

Behind the Numbers: Does a low Say on Pay vote lead to low Director votes?

Our weekly Say on Pay report often raises interesting questions about what the data really mean. These questions are addressed in this series. A question our clients often ask us is whether they should be worried that a low Say on Pay vote will result in low director votes. We found that companies with a low Say on Pay vote had slightly lower average director votes. However, average director votes remain close to 90%, even for companies that failed Say on Pay. Read more

Behind the Numbers: What to expect with a supplemental filing

Our weekly Say on Pay report often raises interesting questions about what the data really mean. These questions are addressed in this series. Through May 15, 2012, at least 77 companies have filed supplemental proxy material specifically targeted at the Say on Pay vote, compared to 45 companies through the same period last year. Interestingly, our database shows that companies that make supplemental filings have experienced slightly lower Say on Pay votes than companies that do not file them, and that ISS recommendations are rarely reversed after a supplemental filing. Read more

Behind the Numbers: How have companies reponded to failed 2011 Say on Pay votes?

Our weekly Say on Pay report often raises interesting questions about what the data really mean. These questions are addressed in this series. As of May 15, all companies that failed Say on Pay in 2011 have passed in 2012. The average vote result for these 16 companies was 89%, an increase of 48 percentage points from 2011. We were curious what types of changes these companies made to their programs following the failed vote to create such an increase in support. Read more