Resource Library Executive & Director Pay Design

With volatility and rising interest rates, will some performance-based equity awards be worth the greater cost?

Say goodbye to the Goldilocks economy, where moderate growth and low inflation sustained us for years. Our global economy and social norms have careened from crisis to crisis over the last 24 months. The world has faced down a pandemic, unprecedented restriction of interpersonal interactions, and disruption of worldwide supply chains. And yet the world economy […]

A big issue facing businesses is whether inflation should lead to higher levels of compensation. The answer is: “it depends.”  

As Committees set compensation amounts and structure, five key questions can inform their decisions.

In 2020, amid the vast economic uncertainty from Covid-19, CEO total pay levels were mostly unchanged year-over-year, with lower cash compensation partially offset by equity grants. As we look ahead and consider how the pandemic will affect pay levels for 2021, we anticipate three trends.

The pandemic has made omnichannel and digital expansion an urgent priority for traditional retailers.

How does the board keep the magic alive as the company matures? How does the organization keep talent engaged when financial incentives become less effective? How do you keep competitors—whether established or upstarts—from coming for your now-proven talent?

The pandemic and other developments have changed the landscape for corporate behavior and strategy. Executive compensation must adapt accordingly for companies to capture fresh opportunities and overcome new challenges.

Stay competitive with your Director Pay decisions to attract the best talent and avoid criticism.

Semler Brossy Consulting Group has conducted a comprehensive, ten-year study on publicly traded real estate investment trust (REIT) pay programs. The study explores how pay trends have moved and changed over time, emerging practices, and the forces driving the changes.

Many business thinkers have criticized corporate “short-termism” that discourages crucial long-term investments in intangible capabilities. Executive pay programs get much of the blame, as even “long-term incentives” last only three years, with the goals for each year’s tranche reset annually.

While the Covid-19 crisis has caused a significant increase in board workload, the increased responsibilities relating to environmental, social and governance (ESG) matters will continue.

Going public means adding structure and formality to many areas of a company. Part of that structure includes forming a compensation committee with a clear charter, delineated responsibilities, and a calendar of actions.