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Peer Group Construction and Analysis Update

June 4, 2015

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A key part of Equilar Insight’s Pay for Performance Analytics, Equilar Market Peers provides a unique and powerful methodology for creating peer groups.

Pay for Performance

Establishing a peer group is a vital step in a company’s pay and performance benchmarking practices. Other stakeholders and industry players may establish their own peer groups as a means of assessing a target company’s pay structure and relative performance in the marketplace. Many methodologies exist for creating a proper peer group. By conducting due diligence and market research, Equilar established a proprietary methodology for creating peer groups based on companies’ publicly disclosed peers.

As a result, best practices are aggregated from corporate issuers’ decisions and not externally-determined criteria. Equilar has created a methodology for creating peer groups that solves the one size-fits-all dilemma. Based on the disclosed peer groups of the company, this flexible process creates the most logical peer groups by using the disclosed peers of the entire Russell 3000.

Equilar Market Peers

Equilar begins with a company’s SEC-disclosed peer group and generates an interconnected network of companies using analytics and algorithms. The final result is a group of 15 Equilar Market Peers comprised of “who you know” and “who knows you,” representing the collective decisions and activities of all Russell 3000 companies.

Companies may ensure they are included in Equilar Market Peers by submitting their updated peer groups through Equilar’s Peer Group Update site before June 30th, as long as they have filed proxies between July 15, 2015 and January 14, 2016. For those who file outside this period, another update will occur in December of each year.

For more information on Equilar Market Peers and Equilar’s Peer Group Update, please visit the Peer Group Validation.

Sample Peer Group Comparison