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Investors to Boards: Be Better Prepared for Shareholder Meetings

February 12, 2016

Shareholder engagement is on the rise and will only continue as investors seek to better understand a company’s practices and policies. As a result, more companies are taking a proactive approach to communicate how their governance...


Split Decisions: CEO/Chair Positions Decline in Response to Shareholder Concerns

February 10, 2016

Traditionally, corporations combined the roles of chief executive officer and board chair, appointing the position to a single leader, but in recent years, shareholders have raised concerns about the combination of these two primary ...


The Role of TSR Modifiers in Long-Term Incentive Plans

February 8, 2016

As a result of increased scrutiny on pay for performance by investors and regulators, more companies have incorporated total shareholder return (TSR) in their incentive plans. Equilar's latest Equity Trends Report shows that almost 50% of...


Institutional Investors on Long-Termism: Subtle Aim at Activists?

February 5, 2016

On February 1, reports surfaced that Laurence Fink, the CEO of BlackRock, had sent a letter to more than 500 companies asking them to focus less on short-term outlooks and estimates and more on long-term strategic approaches as they...


Redstone Retires: Reflections on Board Succession and Shareholder Engagement

February 4, 2016

The rise in shareholder engagement and activist attention to board composition has put companies are under pressure to evaluate their boards on an ongoing basis. Boards that are unprepared to manage a transition may find themselves in...


Boards by the Numbers: New Directors in the Russell 3000

February 3, 2016

The election of new board members is typically a foremost topic of discussion during annual shareholder meetings. This year, with proxy access on the rise, activist and institutional shareholders alike have been focused on consistent...


Staying Ahead of the Curve: Incentive Payouts That Achieve Pay for Performance

February 1, 2016

Since Dodd-Frank and Say-on-Pay were implemented more than five years ago, companies, proxy advisors and shareholders have focused on pay for performance as a measure of effective executive compensation programs. The logic suggests that if...


Board Skills Matrices: Insightful or Redundant?

January 28, 2016

In late 2009, the SEC passed a rule requiring companies to disclose experience, qualifications, attributes or skills for each director on the board or up for nomination, and this information has become highly valued among shareholders...


Are Companies Prepared for Succession Planning?

January 27, 2016

Successful board and CEO succession planning is an integral factor in maintaining long-term stability of companies. Without a strong plan in place, organizations put themselves at risk on many counts. Equilar recently hosted a webinar...


Pay Versus Performance: Are You Prepared?

January 26, 2016

As the calendar barrels into 2016 and proxy season is in our immediate sights, anticipation gathers for how companies will address proposals put forth by the SEC in this year's filings. In particular, the SEC's proposed...


How Companies Handle Hot-Button Proxy Issues

January 21, 2016

Dodd-Frank continues to shape the way companies engage with their shareholders, particularly with matters dealing with executive compensation such as Say-on-Pay and Pay for Performance. Equilar recently hosted a webinar featuring...


On Guard, Part 3: Oversight of Cybersecurity by Industry

January 18, 2016

Cybersecurity strategy will be a crucial corporate risk and governance issue for 2016 and beyond. Customers care about their private data, enterprises value their intellectual property and investors seek assurance that their portfolio...


Shareholder Activism and Director Approval Ratings

January 14, 2016

It’s no secret that shareholder activism is on the rise at U.S. companies, surfacing in many different ways. Shareholders have voting power on a wide range of corporate governance decisions, particularly on the right to choose...


Gender Parity in the Boardroom Still Decades Away

January 11, 2016

The number of women on boards continues to rise, but it will be a long time before female representation at the largest U.S. companies matches their representation in the workforce, according to a new report from the Government Accountability...


Board De-Classification May Lead to More Diversity

January 8, 2016

Board diversity issues have come to the forefront in recent years, and shareholders are pushing companies across the S&P 500 to elect new and diverse candidates to join their boardrooms. Progress has been steady, but many critics...


CEO Tenure Has Increased Nearly One Full Year Since 2005

January 6, 2016

Contrary to trends that may influence executive turnover such as increased M&A activity, scrutiny from activist investors to perform in the short term and an aging boomer population, tenure for S&P 500 CEOs has increased nearly...


Will 2016 Be the Year of Proxy Access?

January 4, 2016

As detailed in Equilar’s latest report, shareholder engagement is on the rise in various forms, and company outreach to ensure investors have appropriate access to exercise their rights is a dominant topic in corporate governance...


New Challenges Inspire Changes to Board Committee Structures

December 17, 2015

As public concerns and needs change, so do board structures. Boards establish and dissolve committees based on their needs to deal with a specific matter or general issue to help the board for diligent decision-making. In the past...


Year-End M&A Flurry Shines a Light on Golden Parachutes

December 16, 2015

As 2015 comes to a close, several major M&A announcements, proposals and rumors are making headlines. In many of these cases, the often-large sums of money outgoing CEOs and other executives stand to receive as severance—also known...


On Guard, Part 2: Board Committee Oversight of Cybersecurity

December 14, 2015

Potentially valuable data underpins the next wave of innovative products, spanning a spectrum from customer credit card and social security numbers to corporate intellectual property. While data breaches at prominent retailers, healthcare...


DowDuPont: A Merger of Activism

December 11, 2015

Dow and DuPont, two of the largest U.S. chemicals companies with a combined $130 billion market cap, agreed to a merger of equals on the morning of December 11. If the deal is approved, they subsequently plan to split into three companies...


Communicating Board Diversity through Disclosure

December 10, 2015

In the past few years, shareholders and boards have given considerable attention to boardroom diversity that reflects a wider variety of opinions, skills and experience to meet the challenges and opportunities in the changing corporate landscape...


Yahoo! Mayer’s Potential Severance Package Draws Significant Attention

December 9, 2015

With investor engagement continuing around what exactly to do with Yahoo, media outlets have turned their attention to Marissa Mayer’s potentially large change-in-control payout in the case that the company were sold and she were terminated. According...


Going Overboard? Restrictions May Shrink Qualified Director Pool

November 20, 2015

With shareholder engagement and outreach coming to the forefront in the wake of Dodd-Frank, directors’ responsibilities are continually expanding into significant professional obligations. As a result, many shareholders and other governance stakeholders...


On Guard, Part 1: Cybersecurity in S&P 500 Boardrooms

October 16, 2015

High profile data breaches grab headlines and deservedly so—exposure of private, proprietary information puts businesses, investors, and consumers at risk. Corporate and large organizational data breaches are increasing in both frequency and magnitude...


@Jack Is Back: Twitter’s New CEO Finds Himself in Rare Company

October 7, 2015

After months of speculation, Twitter named its new CEO this week—the company’s co-founder (and former CEO) Jack Dorsey. Following several quarters of slowing user growth, pressure on Twitter from its investors and from Wall Street in general reached...


The Changing Face of Fortune 1000 Boardrooms, in Five Charts

October 6, 2015

We’re in an unprecedented era in shareholder engagement, and as a result, the make-up of U.S. boardrooms is changing to reflect this new reality. Rules and regulations following Dodd-Frank have heightened the availability of information and awareness...


Chairman/CEO Votes: Signs of Shareholder Trust or Playing It Safe?

September 23, 2015

On September 22, Bank of America shareholders voted whether CEO Brian Moynihan would continue in his role as Chairman of the Board. In the weeks leading up to the shareholder meeting, many wondered if a vote to split the roles and implement...


Eradicating Cyber-risk: CEO Expertise and Experience

September 15, 2015

As companies rely more heavily on compiling, storing, utilizing, and disseminating large amounts of proprietary and private data, securing such information continues to pique the interest of invested parties. Customers, consumers and vendors...


Change-in-Control: Pay Trends in Transition

September 3, 2015

Although corporate change-in-control (CIC) situations happen infrequently, stakeholders place the details of such transactions under a microscope, scrutinizing them from every angle. In particular, proxy advisory firms and shareholders view...


Weighing in on Performance Metrics

August 27, 2015

When it comes to doling out long-term incentive plans, shareholders and companies both hold vested interests in how awards are structured. Not only do equity awards contribute to the retention of executives, but they also set the tone for...


Director Compensation Under Scrutiny: Are Pay Increases Justified?

August 20, 2015

Median director pay among S&P 500 companies has increased significantly in recent years. According to the latest Equilar research, director retainers reached a median $235,000 in 2014, up from $215,000 two years prior. In response, shareholders...


SEC Shines a Spotlight on CEO-Employee Pay Ratio

August 5, 2015

Dodd-Frank initially mandated that U.S. public companies disclose the ratio of median pay between their CEOs and their employees, and thus the subject has been a source of much discussion since its passing. But five years later, exactly how...


Does It Really Pay for CEOs to Perform? A Comparative Analysis

August 4, 2015

CEO pay continues to rise, reaching a median $10.3 million among S&P 500 companies in 2014, according to Equilar’s latest research. But alongside consistent growth, CEO compensation has also experienced increased scrutiny since the passing of Dodd-Frank...


Dodd-Frank’s Fifth Anniversary: In Retrospect and Prospect

July 27, 2015

The Dodd-Frank Wall Street Reform and Consumer Protection Act – better known colloquially as “Dodd-Frank” – celebrated its fifth anniversary on July 21, 2015. Though the sweeping financial markets reform initiated by this legislation has yet to...


Equity Compensation Plans: Breaking down Dilution

July 24, 2015

A well-designed equity compensation or performance incentive plan has potential to be a “win-win” for those with skin in the game, and corporate issuers have the opportunity to align their stakeholders’ interests by including equity pay in executive...


Enforcing Accurate Financial Reporting — Clawbacks

July 6, 2015

The Securities and Exchange Commission (SEC) recently proposed a set of rules that would govern the clawback provisions of listed companies. These standards would apply specifically to compensation that is linked to accounting-related metrics, stock price...


Pay Versus Performance Rule Faces Potential Issues

June 18, 2015

As noted in a previous post, the Securities and Exchange Commission (SEC) recently released language concerning the Pay Versus Performance disclosure required by the Dodd-Frank Wall Street Reform and Consumer Protection Act. Public comment on the...


CFO Pay Increases: Falling Behind the CEO?

June 10, 2015

In a recent post, we looked at changes in CEO pay in the S&P 1500 and how that compares to the average worker. While the CEO is typically a company’s highest paid and most high-profile employee, they are but one member of the executive team. Using...


Peer Group Construction and Analysis Update

June 4, 2015

A key part of Equilar Insight’s Pay for Performance Analytics, Equilar Market Peers provides a unique and powerful methodology for creating peer groups. Establishing a peer group is a vital step in a company’s pay and performance benchmarking practices. Other...


Anticipating the CEO Pay Ratio – CEO Pay vs Median Income

May 20, 2015

The difference in pay between CEOs and the average worker became a hot-button issue in the years following the financial crisis of 2008. The Dodd-Frank Wall Street Reform and Consumer Protection Act mandates that companies disclose the pay ratio between the CEO...


CEO Pay Rising for Both Genders

May 19, 2015

On May 16, 2015, Equilar announced the publication of the Equilar 200 CEO Pay Study in The New York Times. This list contains the 200 highest-paid chief executive officers among public U.S. companies valued at $1 billion or more in market...


Shopify IPO Emerges With New Details

May 11, 2015

Shopify, an e-commerce software company based in Ottawa, Ontario, revealed last Wednesday in a new SEC filing that it is aiming to raise upwards of $107.8 million through its IPO with shares pricing between $12 and $14 each. Upon the offering, Co-Founder, Chairman of...


Why Do Some Companies Defend a Failed Say on Pay Vote?

May 7, 2015

The years since the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act have seen increasing attempts to link executive pay with performance. One requirement of the bill is that companies hold regular shareholder votes on executive compensation packages...


SEC Proposes Pay For Performance Rule

April 29, 2015

On April 29, 2015, the SEC released a proposal to enact Section 953 of the Dodd-Frank Act. Section 953 deals with the relationship between compensation and company performance. This is the second executive compensation rule proposed this year by the SEC, following the...


Zero Base Salary Earned by American Airlines CEO

April 24, 2015

It’s common practice for most firms to make a certain percentage of executive compensation “at risk.” This can be in the form of variable cash payouts as well as equity awards, which intrinsically align the officer in questions’ goals with those of and the company...


Equilar 100 Study Key Findings, as seen in The New York Times

April 17, 2015

On Friday, April 10th, the New York Times published its coverage of the Equilar 100 CEO Pay Study, an analysis of CEO pay at the 100 largest public U.S. companies as measured by revenue. Over the past nine years, Equilar has collaborated with The New York Times...


CEO Median Pay Ratio: Standard Deviation in Standards

April 8, 2015

One of the measures proposed by the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act) is mandatory disclosure of the ratio between the CEO’s compensation and the compensation of the average worker. Though this rule has not yet been....


Google CFO Hire Makes a Big Splash in Executive Compensation

April 2, 2015

Executive compensation has made the news recently with Google offering a $70 million pay package to incoming CFO Ruth Porat. Beyond the eye-catching headline, several interesting kernels are buried inside the deal. Google...


Domino’s Proxy Statement – That’s a Big Pizza Pie

March 30, 2015

Every year, as thousands of proxy statements are processed and analyzed, there are many interesting nuggets of information. While not always the most critical data points, their uniqueness can be appreciated. This blog post will focus on one of these finds...


Succession Planning Implications for CEO to Executive Chair Transitions

March 18, 2015

CEO succession and transition planning is an essential topic for boards and a primary focus of shareholders. Committees responsible for succession planning are addressing the issue on an ongoing basis throughout the year to develop plans that ensure...


The Return of Proxy Access

March 11, 2015

With each proxy season comes a deluge of shareholder proposals, making it onto the ballots of many public companies under SEC Rule 14a-8. These proposals are formal in nature for most public companies and often there is considerable variation in...


Proxy Filings Bring March (and April) Madness

March 5, 2015

March and April can be a busy time of the year for people and companies alike, as deadlines approach to file taxes and other filings with the IRS and SEC. Unlike the notable deadline of April 15 for taxes, the lesser-known SEC deadline of April 30 is a date...


Investor Survey 2015 — What Matters to Investors in Proxy Statements

February 24, 2015

In the fall of 2014, RR Donnelley, Equilar, and the Rock Center for Corporate Governance at Stanford University surveyed 64 asset managers and owners with a combined $17 trillion in assets to understand how institutional investors use the information in...


Key Findings from 2015 Innovations in CD&A Design

February 18, 2015

CD&A length decreased slightly in 2014 despite steady growth over the previous five years. As companies continue to emphasize disclosure to communicate more effectively with shareholders, CD&A word counts decreased 1.3% from an average of 9,046 words in...


A Behind-the-Scenes Look at Annual Incentive Plans

February 12, 2015

In the fall of 2014, RR Donnelley, Equilar, and the Rock Center for Corporate Governance at Stanford University surveyed 64 asset managers and owners with a combined $17 trillion in assets to understand how institutional investors use the information in...


Tax Man Cometh: Tax Gross-Ups and Other Certainties in Life

February 4, 2015

The start of any new year marks the rapid onset of the less macabre of Benjamin Franklin’s two certainties. For most Americans, filing taxes is complicated enough to spawn an entire industry dedicated to the assistance thereof. For recipients of corporate perquisites...


NPR Planet Money on “Board Games” – A Look at Compensation

February 3, 2015

The topic of CEO pay has once again made the news, this time through the medium of National Public Radio’s This American Life. This particular episode, entitled “Board Games” – whose transcript is available here – recounted the attempts of two activist investors to reduce...


Apple Executive Compensation Highlights

January 29, 2015

On Thursday, January 22, Apple Inc. (AAPL) filed its annual proxy for the upcoming shareholder meeting. Provided in the proxy is compensation information for its named executive officers (NEOs), notably including CEO Tim Cook and Senior Vice President of Retail...


Pay for Performance: 3 Key Updates to ISS and Glass Lewis Models

January 27, 2015

We have updated our Equilar Insight ISS Simulator and Glass Lewis Model in the Pay for Performance center to reflect recent changes in their methodology. ISS Simulator: New threshold values to determine the level of concern for “Pay-TSR Alignment” and “Relative Degree of Alignment". Glass Lewis Model: Early access to the upcoming...


An Important Factor to Keep in Mind for IPOs – Stock Structure

January 21, 2015

A recent article by Equilar highlighted some of the key executive compensation and governance considerations for companies undergoing initial public offerings (IPOs). The past two years have produced a large number of U.S. companies that have undergone IPOs and the market appears...


Shake Shack Prepares for its IPO, Founder and Chairman to Cash In

January 20, 2015

Shake Shack, a fast casual restaurant chain based in New York, NY, is looking to raise upwards of $80.0 million through its IPO with shares pricing between $14.00 and $16.00 each. Upon the offering, Founder and Chairman of the Board Daniel Meyer...


Box IPO in the Works – How Does it Measure Up?

January 15, 2015

Box, a prepackaged software company based in Los Altos, California, is looking to raise upwards of $186.9 million through its IPO. The Box IPO is expected to price shares between $11 and $13. Upon the offering, CEO Aaron Levie is expected...


Security Perquisites for CEOs – Paying for Protection

January 14, 2015

Personal and home security perquisites are absolutely on the list of benefits to influential individuals such as the CEOs of Fortune 100 companies. Less glamorous than corporate aircraft and less controversial than tax gross-ups, this is one expenditure that is often...


Performance Metrics Rigor Gets Renewed Focus in 2015

January 8, 2015

As mentioned in Agenda’s recent article, ‘Comp Committees Gun for Better Pay Metrics’ by Lisa Botter: “Executive compensation data firm Equilar’s recent Compensation and Governance Outlook Report for 2015 found that companies were focusing on metrics...


What Benefits & Perquisites Do Companies Provide to Executives?

December 17, 2014

In recent months, we have seen an increased interest in benefits and perquisites analyses for management at leading companies. As organizations prepare for proxy season 2015 and the disclosure of “other” compensation for named executives, sensitivity to excessive perks...


IPOs in Silicon Valley Set for Big Week

December 5, 2014

Three Bay Area technology companies planning to go public next week recently amended S-1 filings in preparation for their IPOs. LendingClub (LC), the peer-to-peer loan company based in San Francisco, is seeking to become to the second largest tech initial public...


Pay Equity Among Top 15 C-Suite Executives

December 3, 2014

The pending CEO-to-median-worker pay ratio rule by the SEC has brought the discussion regarding pay equity to the forefront. Although most companies do not consider the median worker’s pay when setting the chief executive’s pay, comparison among top level...


Allergan Change in Control Policy Analysis

November 20, 2014

On November 16, 2014, Allergan agreed to be acquired by Actavis for $66 billion. At the effective time of the merger, each share of Allergan’s common stock issued and outstanding, immediately prior to the acquisition, will be converted into the right...


Change in Control Analysis of Halliburton’s Purchase of Baker Hughes

November 19, 2014

Halliburton agreed on Monday to buy Baker Hughes for about $35 billion in cash and stock. Baker Hughes previously entered into agreements with each of its senior executives, which were intended to provide for continuity of management in the event of a change...


Virgin IPO: Estimating the Potential Value for Sir Richard Branson

November 14, 2014

Virgin America, the privately owned airline based in Burlingame, California, is hoping to raise upwards of $320 million through its IPO on NASDAQ this week. Based on an S-1/A filed today, the company still anticipates that the initial public offering...


Spinoff Transactions and Founder Awards

November 6, 2014

Spinoffs serve an important economic function, allowing parent organizations to refocus themselves on core competencies and spinoff companies to pursue their own business goals, perhaps through seeking new buyers with whom they could achieve greater...


Retention Awards for Financial Industry CEOs

November 4, 2014

With the improving economy and increased competition for talent, our clients’ interest in the prevalence of retention awards and best practices for top management has increased accordingly. One of our recent custom research projects explores...


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