Partner Lauren Peek and Principal Joanna Czyzewski’s early filers research was featured a recent Agenda article. The article highlights that median total direct compensation for CEOs at early filers increased 9% year over year, driven by the 14% increase in actual bonus payout, plus a 7% increase in the grant date value of long-term incentives. The change in bonus dollars year over year was largely impacted by those companies that experienced extremes — whether up or down.
Partner Shaun Bisman was quoted in Agenda’s article on the challenges that tariffs pose for executive compensation planning. Shaun highlights a key concern about the uncertainty surrounding tariffs and how they may affect companies’ financial performance, directly influencing CEO incentive pay. He notes that compensation committees are weighing different approaches, including (i) baking in tariff-related assumptions when setting performance goals, (ii) adjusting goals at the end of performance periods, and (iii) widening goal ranges to account for uncertainty.
Partner Shaun Bisman was featured in Agenda’s article discussing the expansion of employee health benefits in certain organizations. Shaun highlighted how compensation committees are broadening their focus beyond executive pay, taking a holistic view of total rewards and human capital management. Committees are expanding their scope to include critical factors such as employee wellness, mental health, and innovative benefits to attract and retain top talent in a competitive market.
Partner Shaun Bisman was quoted in Agenda discussing CEO Pay and Investor Support. In the article, Shaun discusses how companies that have made “atypical” moves in pay programs (e.g., adjusting payouts, issuing retention awards or changing vesting conditions for unvested awards at a termination) should always disclose strong rationales behind those decisions. Alignment, and communication around that alignment, is very important to shareholders. Shaun also mentions how companies will continue to focus on ESG/diversity but will be “rebranding” these metrics in light of political backlash.
Partner Shaun Bisman was quoted in Agenda’s lead newsletter article discussing Glass Lewis guidelines. In the article, Shaun discusses how Glass Lewis can be relatively opaque in its guidelines compared to ISS, but that Glass Lewis does stress in its latest set of policies that it will be on the lookout for problematic pay practices such as high severance payouts, problematic contractual payments, discretionary bonuses and other practices. Shaun also discussed the update to their (Glass Lewis) change-in-control policies.
Partner Matt Vnuk was quoted in Agenda discussing CAP’s recent Director Pay Research study “Director Compensation: Steady State is Current State”.
Partner Kelly Malafis and Principal Roman Beleuta were quoted in Agenda discussing their study on CFO pay trends. Compensation for CFOs should be strongly monitored in order for boards to attract and retain competitive CFOs. Yet comp committees should also understand that pay is just one piece of the pie. Companies need to ensure that finance executives are getting the exposure and leadership opportunities needed to strengthen the value proposition for the executive and the company. Roman and Kelly’s study found that CFO pay increases (8%) outpaced CEOs (5%) in 2023.
