Our Insights

Director Pay: The ‘Why’ Behind the ‘What’

Establishing principles to address specific pay program amounts and components will help the Board to ensure that decisions regarding director pay are made thoughtfully, holistically, and accurately. Read the entire article (PDF) written by Blair Jones. Read more

Proctor and Gamble’s Balanced Approach to Long-Term Incentives

Rather than following the trend of discarding stock options as the primary LTI vehicle, Procter & Gamble considered what role LTIs (and specifically stock options) should play for their people in the future. They used P&G’s business and people strategies as the basis for a balanced, full-scale review of their global LTI practices. Read the entire article (PDF) written by Blair Jones. Read more

Trends in Director Compensation

In the wake of corporate scandals, increased regulation, and heightened institutional investor interest in board activity, we have seen a commensurate change in both pay levels and pay structure. This change reflects the greater time and effort required of board members, as well as the greater risk these individuals face. Read the entire article (PDF) written by Blair Jones. Read more

‘Taking Inventory’ of the CEO

An effective assessment process will ensure the development of stronger CEOs. In this piece, the authors present a model of a comprehensive and fair process. Read the entire article (PDF) written by Seymour Burchman. Read more

Executive Compensation: Shareholder Expectations and Proxy Trends

Many of the issues related to executive pay today have emerged because of shortfalls with stock options during the 1990s. Companies’ responses to these issues are beginning to set some trends, including the use of alternative LTI vehicles, increased emphasis on ownership guidelines, and changes to option mechanics. Read more

Choosing & Using the Right Measures & Goals in Long-Term Compensation Plans

Many companies are now adopting or considering long-term incentive plans where value realized by participants is contingent on achievement of specific performance goals, which are often not based on stock-price. While these types of plans provide opportunities to focus management on results that will drive shareholder value, they don’t come without significant risk of unintended consequences. Read the transcript of Roger Brossy and Richard Semler as it appeared in the WorldatWork Society of Certified Professionals Member Chat. Read more

Adapting Stock Plans to New Realities

For the last decade, the toughest question many companies faced about long-term compensation was: "How many stock options should we give out, and to whom?" Today, we are in the midst of unprecedented change in every aspect of long-term and stock compensation, and plans and practices need to be examined in light of new accounting rules, increasing shareholder scrutiny, and changing employee attitudes. As U.S. companies review their current stock option or other long-term compensation plans, the tried and true assumptions on what's right or even what works are already problematic at best. Companies need to plan how to adapt now, or evolution is likely to pass them by. Read the entire article (PDF) written by Roger Brossy and Richard Semler. Read more