Compensation Standards features CAP’s memo examining a sample of 20 high-profile tech IPOs from recent years to understand equity practices leading up to going public. The memo finds, among other insights, that options are still the favorite form of equity awards – but there’s been a shift to granting more RSUs, typically with double-trigger vesting based on both years of service and going public.

Compensation Standards highlights CAP’s report on say-on-pay vote outcomes. Although support has been fairly consistent for the last 10 years, the report says this year’s say-on-pay results may depart from these prior norms. For 2021, CAP says pay-for-performance misalignment will be the main driver for ISS “against” recommendations. Say-on-Pay vote results will continue to depend on the magnitude of pay, pay practices and stock price performance.

Compensation Standards summarizes CAP’s memo on ISS’ attitude towards COVID-related pay changes. Among the key findings are that if a company made COVID-related compensation changes and received an elevated level of concern on the ISS pay for performance evaluation, the proxy advisor will likely recommend against the Say on Pay proposal, thereby significantly impacting the Say on Pay vote. To date, CAP has observed three companies that experienced sharp declines in their Say on Pay results, with one failing to receive majority support.

CAP released an in-depth memo on COVID-19 pay actions in proxies from companies with early fiscal year ends as well as a searchable COVID-related pay action tracker available on its website.

Liz Dunshee of Compensation Standards examines the role retention awards can play in bankruptcies based on CAP’s memo on bankruptcies triggered by COVID.

Liz Dunshee of Compensation Standards discusses the “CAP 120” survey, which analyzes 120 companies from ten industries. (Please note that the blog post is behind a pay wall, but the CAP 120 can be accessed here.)

CAP recently completed the 10th annual analysis of non-employee director compensation among the 100 largest companies.

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Jul 22, 2021

Human Capital and Compensation Oversight

Webinar

Partner Bertha Masuda will lead a discussion with three seasoned Board Directors on Human Capital and Compensation Oversight as part of the NACD Private…
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