Principal Shaun Bisman and Associate Jared Sorhaindo recently authored an article that was published by Harvard Law School’s Forum on Corporate Governance. The article details the recent ISS-issued frequently asked questions (FAQs) documents related to equity compensation plans, peer group selection methodology and issuer submission process, and compensation policies. The equity compensation plan FAQs cover topics under the rubric of ISS’ Equity Plan Scorecard and the compensation policies FAQs cover compensation topics more broadly.

A recent CAP alert detailing the updated proxy voting guidelines for 2023 was reprinted by the Harvard Law School Forum on Corporate Governance. This alert was authored by Principal Shaun Bisman and Associate Jared Sorhaindo. The recent policy changes released by ISS will go into effect for annual meetings held on or after February 1, 2023. Among the changes discussed are updated guidelines on problematic pay practices, value-adjusted burn rate, ESG metrics, board gender diversity, shareholder proposals on racial equity and/or civil rights audits, and climate accountability.

A CAP report was recently published by the Harvard Law School Forum on Corporate Governance. The report details the Private Company Board Compensation and Governance Survey that CAP and Family Business and Private Company Director magazines conducted this year. Board members at privately held and family-owned companies play an important role in governance and oversight and this survey adds insight on how these members are compensated. It also addresses the data deficiency on private company board pay. This survey was conducted and published by Partners Bertha Masuda and Susan Schroeder and Principal Bonnie Schindler. Harrison Evans and Gabriel Brown also provided analysis for this report.

Partner Dan Laddin, and Senior Analyst Louisa Heywood wrote an article on the new Pay Versus Performance disclosure requirements. The requirements are to help shareholders compare executive compensation with company financial performance over a period of several years. Any company with a fiscal year that ends on December 16, 2022, or after will be required to have this disclosure in their next proxy statement.

Partner Melissa Burek, and Principal Michael Bonner wrote a report on long-term incentive plans that was published by the Harvard Law School Forum on Corporate Governance. The report analyzed 120 companies with a median revenue of $36 billion. CAP looked at the long-term incentive performance cycles that ended from 2015 to 2020 for these companies. In the report they unveil their main findings from this analysis.

The Harvard Law School Forum on Corporate Governance recently published findings from the popular CAP Early Filers report authored by Principals Lauren Peek and Joanna Czyzewski. In this report, CAP reviewed Chief Executive Officer (CEO) pay levels among 50 companies with fiscal years ending between August and October 2021 (defined as the Early Filers). CAP found that 2021 was definitely a “bounce back” year where median CEO pay was increased by 19%. This large increase in CEO pay is mostly due to a dramatic year over year increase (+73%) in the annual incentive payout since base salaries were flat at median and the grant-date value of long-term incentive increased 11%.

A CAP Alert authored by Partner Dan Laddin and Senior Analyst Louisa Heywood was published by the Harvard Law School Forum on Corporate Governance. The alert detailed recent action by the SEC to re-open the comment period for pay vs. performance proposed rules. The proposed changes include requiring disclosure of three new financial performance measures in addition to TSR and requiring companies to provide a list of the five most important performance measures used to determine compensation actually paid to the executive. In the memorandum, CAP supports the objective of enhanced transparency.