A RESOURCE FOR BOARDS AND EXECUTIVES

Coronavirus and Executive Compensation

Here, you will find regular updates on compensation issues related to Covid-19, including our latest thinking on the implications for executive compensation programs, an inventory of publicly disclosed actions companies have taken in response, and the results of our survey about how companies are managing compensation issues.

FEATURED REPORTS

REPORT

Incentive Design Changes in Response to Covid-19, Russell 1000

Incentive design changes in response to Covid-19. Updated 9/10/2020. We also partnered with The Conference Board and ESGUAGE analytics on a new database tracking incentive design changes across the Russell 3000 (as of 10/9/2020), where users can filter the data and view visualizations. 

PAY ACTION REPORT

VOLUME 5: Impact of Covid-19 on Executive and Director Compensation

Inventory of publicly disclosed executive compensation actions in response to Covid-19. Updated 5/18/2020. We also partnered with The Conference Board and ESGUAGE analytics on a live database tracking these actions, where users can filter the data and view additional visualizations.

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SURVEY RESULTS

Covid-19 Pulse Results: Effectively Managing Executive Compensation in a Crisis

Covid-19 will have broad implications for compensation programs at most companies, but many are delaying key decisions until they have greater clarity. The report highlights current actions taken and those in consideration for late 2020 and 2021.

OUR INSIGHT on Covid-19

Modification to In-Flight Performance Share Awards: Accounting and Disclosure Implications

October 13, 2020 by Blair Jones, Doug Tormey

Companies considering adjustments to in-flight performance share awards as a result of COVID-19 must consider accounting and disclosure implications of a modification to the awards.

Webinar: Incentive Design Changes in Response to Covid

October 6, 2020 by Blair Jones, Greg Arnold

Semler Brossy moves the incentive pay conversation forward in a recent webinar, sharing insights from relevant client work and a recent study of pandemic-driven incentive changes for Russell 1000 companies.

What to Do About Long-Term Incentives in the Pandemic

September 9, 2020 by Blair Jones, John Borneman and Andres Ibarra

Whatever boards decide, they will want to be clear and transparent on any substantial departures from usual practice.

What to Do About Annual Incentive Plans in the Pandemic

August 25, 2020 by Blair Jones, John Borneman and Andres Ibarra

Boards can still work to ensure they position their companies as well as possible to enter FY2021.

Principles for Paying Incentives in the Midst of Covid-19

July 17, 2020 by Greg Arnold & Blair Jones

As the crisis extends, Boards are challenged with how to forecast, and how to keep executives motivated.

At Your Discretion

July 10, 2020 by Greg Arnold & Mark Emanuel

When and how should directors adjust executive incentive payouts?

Human Capital Management: Pandemic Challenges and Opportunities

June 5, 2020 by Blair Jones, Avi Sheldon and Matt Westlund (download)

For boards, the pandemic is a major opportunity to work with management to build a competitive advantage through human capital investment.

Remembering TARP: The Executive Compensation Guidelines

May 2020 by Avi Sheldon (download)

As bailout money is approved, we recommend a look back at the impact of TARP on executive compensation. We put together this document as a reference guide.

Preparing for Pandemic-Related Discretionary Compensation Adjustments

April 30, 2020 by Mark Emanuel and Blair Jones

This article offers a framework for tracking the business impacts from Covid-19, and for laying a foundation for any pay adjustments.

The Long-Tailed Impact of the Covid-19 Pandemic on Compensation

April 23, 2020 by Austin Vanbastelaer and Todd Sirras

The employee/employer relationship, including compensation and benefits, will be radically different in the post-Covid-19 world.

Emergency Succession Planning in a Covid-19 World

April 7, 2020 By Greg Arnold and Todd Sirras

Covid-19 will create a separate set of issues, but the principles for dealing with sudden executive turnover are consistent.

Director Stock Awards during Covid-19

April 6, 2020 By John Borneman

One of the next significant pay actions will be making stock awards to board members.

Coronavirus and Compensation: What Should Companies Do Now?

March 26, 2020 By John Borneman, Blair Jones & Kathryn Neel

As the scale and severity of Covid-19 continues to expand, companies are wrestling with a host of business continuity and human resource challenges.

Four Ways to Appropriately Address the Impact of Covid-19 on Executive Compensation Programs

March 10, 2020 By Greg Arnold & Todd Sirras

As the scale and severity of Covid-19 continues to expand, companies are wrestling with a host of business continuity and human resource challenges.

From Dialogue

Coronavirus Crisis Dents Salaries, Not Stock Awards, for Many CEOs

June 3, 2020 By The Wall Street Journal (subscription required)

Hundreds of U.S. companies reduced salaries for their chief executives as the coronavirus pandemic swept across American business….

U.S. Firms Shield CEO Pay as Pandemic Hits Workers, Investors

May 28, 2020 By Reuters

Sonic Automotive Inc (SAH.N), which operates 95 U.S. car dealerships, started laying off and furloughing about a third of its workforce….

Executive Compensation May Set the Tone for a Company’s Response During Covid-19

May 22, 2020 By KPMG LLP (download)

The impact of COVID-19 is beyond what typical business continuity and resilience plans have contemplated. As a result, all parts….

Coronavirus Puts Top Executives’ Pay in the Spotlight

May 17, 2020 By Financial Times (subscription required)

Like most high street retailers, UK jewellers H Samuel and Ernest Jones have been hammered by the coronavirus. Amid slumping sales…

Covid-19 Impact on Executive Compensation — Amending Performance Goals under Equity and Other Incentive Awards

May 12, 2020 By Proskauer Rose LLP

Setting meaningful and effective performance goals often requires significant focus and analysis by compensation committees with…

As Rich 2019 Paydays Roll In, Media CEO Salaries Will Be Hard To Justify in a Covid-19 Economy

May 1, 2020 By Deadline.com

April proxy season, which just ended, is an annual rite that lifts the curtain on CEO salaries for the previous year ahead…

Covid-19: Impact on Nonqualified Deferred Compensation Plans

April 29, 2020 By Davis Polk & Wardwell LLP (download)

The coronavirus (Covid-19) pandemic and the ensuing market uncertainty, as well as recently enacted legislation, have upended…

Coronavirus Crimps Some CEO Salaries but Not All

April 24, 2020 By The Wall Street Journal (subscription required)

Cheesecake Factory Inc. furloughed about 41,000 hourly restaurant workers to conserve cash in the coronavirus pandemic…

The Covid-19 Test for Compensation Committees

April 24, 2020 By Morgan Lewis & Bockius LLP

Compensation committees of US-based public companies (Compensation Committees) will have important decisions to make in the coming…

Companies That Don’t Cut Executive Pay Now Could Pay for It Later

April 21, 2020 By The Wall Street Journal (subscription required)

Senior executives are taking pay cuts in an attempt to show solidarity with their employees who are being downsized in unprecedented…

Covid-19 Business Impact: Interpretive Issues Under the CARES Act Pay Limits

April 21, 2020 By Dechert LLP

The Coronavirus Aid Relief and Economic Security Act (the “CARES Act”)1 is the third stimulus package passed by Congress to combat the effects…

Covid-19 – Considerations for Public Company Director Compensation

April 21, 2020 By Cooley LLP

As businesses continue to navigate the health and economic challenges posed by the Covid-19 pandemic, annual shareholder meeting dates…

Addressing the Impact of Covid-19 in the 2020 Proxy Statement

April 20, 2020 By Weil, Gotshal & Manges LLP

As companies prepare to file their proxy statements for the 2020 annual meeting, the question arises as to where…

Employee Benefits Issues When Implementing Employee Salary Reductions Due to Coronavirus

April 15, 2020 By Foley & Lardner LLP

As the novel coronavirus pandemic continues to impact businesses across the country and the world, many employers have…

Covid-19 Compensation Q&As: Incentive Plans and Deferred Compensation

April 13, 2020 By Pepper Hamilton LLP

This article answers questions about incentive plan considerations and nonqualified deferred compensation issues arising…

The Covid-19 Corporate Response Tracker: How America’s Largest Employers Are Treating Stakeholders Amid the Coronavirus Crisis

March 31, 2020 By JUST Capital

The coronavirus pandemic and impending recession have created an urgent, unprecedented opportunity for CEOs and corporate leaders…

A Death at Jefferies Highlights Urgency of C-Suite Backup Plans

March 29, 2020 By Bloomberg (subscription required)

Like all aspects of society, the rules of the C-suite are being rewritten under the pressure of a deadly pandemic…

Coronavirus Caps Years of Rich Pay for Many CEOs

March 23, 2020 By The Wall Street Journal (subscription required)

Chief executives of large U.S. companies rode a more than decade-long bull market to a string of record pay days. Now, the stock…

Why CEOs Give Up Their Salary During a Crisis

March 18, 2020 By Adweek, LLC

While the C-suites of America’s top airlines are asking the U.S. government for what could amount to more than $50 billion…

Companies Adjust Executive Pay Amid Covid-19

March 17, 2020 By Equilar Inc.

The landscape of the world has been significantly impacted by the outbreak of the coronavirus (Covid-19) in a matter of weeks. On Friday…

The Impact of Covid-19 on Incentive Compensation

March 16, 2020 By Shearman & Sterling LLP

The Covid-19 outbreak has had a swift and volatile impact on business operations and the financial markets. Because this…

The Impact of Covid-19 on Performance-Based Compensation Programs

March 13, 2020 By Paul, Weiss, Rifkind, Wharton & Garrison LLP

As the coronavirus disease (Covid-19) pandemic continues and the economic consequences are becoming increasingly severe, this Client…