Latest Insights & Industry Trends

"In order to understand the financial performance measures, target goals, performance ranges, and payouts of an annual incentive plan, we analyzed the proxy-disclosed practices of approximately 100 manufacturing and materials companies. We assessed year-over-year (YOY) trends in...

"Starting with the 2018 proxy statement (covering fiscal year 2017), most public companies will be required to start reporting their CEO pay ratio, that is, the ratio of the CEO’s pay to the median of all other employees’ pay. While it is questionable whether the CEO pay...

"Political swings, global volatility, technology innovations and investor expectations will require deeper board engagement. Drawing on interactions with corporate directors and business leaders as well as insights from its research, the KPMG Board Leadership Center has...

Check out this interesting read regarding the new say on pay rules, form 10-k summaries, and a guide for proxy season. "As another year comes to a close, it is time for public companies to become acquainted with the securities law and business developments of the past year...

"2016 was a year marked by significant changes—stunning political upheavals via Brexit and our own controversial new President-elect; a growing number of big-ticket, multi billion dollar M&A deals amid massive enterprise court battles, particularly in the technology...

Wilkins Finston Friedman Law Group “wrapped up” the year 2016 with their predictions of the benefit issues employers will face in 2017. Here are their top four benefit issues for 2017: •Health Care Reform. Speculation is rampant as to the extent of the upcoming changes...

"Board director compensation levels for middle market companies kept pace with the economy between 2014 and 2015, according to a new report from BDO USA, LLP, a leading accounting and consulting organization. Following years of solid increases, compensation remained relatively...

"The criteria for earning short-term incentive (STI) compensation appear to have entered a state of flux, judging by new research from the CFO Alliance. In particular, some companies are putting non-financial metrics, like customer or employee satisfaction, into the mix. But far...

ISS has published the U.S. Frequently Asked Questions for Equity Plan Compensation, Executive Compensation, Pay-for-Performance Mechanics, and U.S. Peer Selection (available here). In addition, an updated PFP white paper to reflect the new financial performance alignment test...

"Are chief executive officers worth their pay? Apple CEO Tim Cook's $10 million in compensation isn't chump change, but it's a bargain when you compare that to the company's massive average economic profit over the last three years. Other companies pay their CEOs much more, but...

"Veteran director Sara Hays shares insights from her board’s successful CEO search. As chair of the board’s CEO search committee, what best practices can she offer? The search and selection of a CEO is among the board’s most important foundational duties. While sometimes...

"Equilar’s Compensation Committee Forum covered topics from regulatory updates to peer group selection and Say on Pay. The realm of executive and director pay is a tumultuous one. Whether preparing for the impending CEO Pay Ratio or anticipating the regulatory changes ahead,...

"Last month, the IRS provided helpful guidance under Code Section 409A with the release of its Chief Counsel Advice 201645012 (the CCA). The CCA is noteworthy because the IRS agreed that a 25% increase qualified as a materially greater amount, and thus deferred salary was...

2015 middle market executive compensation trends foreshadowed momentum companies are seeing in 2016. In Q2, the National Center for the Middle Market reported 7.2 percent revenue growth over the previous year, and while companies entered the year with some caution, 2015 pay...

One thing is for certain, the results of the election created a myriad of questions regarding the future of American politics. Less certain, though, is the level of impact the results will have on the futures of various executive compensation and corporate governance policies...

Sandra Pace, Managing Partner, Steven Hall & Partners, and Michael Sherry, CECP, Consultant, Steven Hall & Partners, discuss why organizations may be struggling to maintain their incentive programs, emerging considerations, pitfalls, and best practices. View the video...

We wanted to share this important invitation from ISS to submit changes to self-selected pay benchmarking peer group: As a reminder, Institutional Shareholder Services Inc. (ISS) recently announced the opening of its peer group construction process and requests your...

"Late last month, the SEC issued (and this month it posted) a No-Action Letter rejecting Apple’s attempt to exclude a shareholder proposal on executive compensation. The proposal was an odd one, with a quirky supporting statement, apparently submitted by a retail investors on...

Eugene Fram was a guest on Tony Martignetti's Nonprofit Radio last month, and in his interview he provided some great tips for non-profit boards. He is professor emeritus at Rochester Institute of Technology and author of “Going For Impact: The Nonprofit Director’s Essential...

"The problem with creating an incentive plan is that your employees just might do whatever you incentivize them to do. If you pay bonuses based solely on earnings growth, then you might not only get growth in earnings but also really bad loans that eventually sink the bank. If...

"Whether you’re looking at a mutual fund or company stock, you want to see the management team having a significant amount of their own 'skin in the game' through a large commitment of personal financial resources. While this doesn’t guarantee success, at least you know the...

On October 18, 2016, the staff of the Division of Corporation Finance of the Securities and Exchange Commission published five new Compliance & Disclosure Interpretations (CDIs) related to CEO pay ratio disclosures. The CDIs provide some clarity on how companies can begin...

Here are some trending hot topics in executive compensation, written by Brad Smith at Findley...

Institutional Shareholder Services Inc. (“ISS”), the influential proxy advisory firm, recently released their 2016-2017 Global Policy Survey results. These results show some interesting findings related to executive compensation and may signal the future of ISS policies...

This presentation by NFP Compensation Consulting will identify the differences of today's workforce with four very different generations of Workers: Baby boomers, Gen X, Millennials & Gen Z. The discussion will include what motivates the different generations along with the...

"Public companies in the U.S. will be required to disclose the ratio of CEO pay to median employee pay in their 2018 proxy statements—reporting on fiscal year 2017—and many are already working through the calculations involved. Prudent companies are also considering the...

"Over the past two years, a growing number of U.S. banks has capped their directors' earnings, but the ceilings are so high that they primarily serve to fend off potential shareholder litigation rather than control the pace of pay increases. Most of the caps are typically 2-3...

New compensation and governance standards are impacting boards of directors in all industries, but even more so in banking, which has more regulatory requirements and is under greater scrutiny. The recent Wells Fargo & Co. $185 million settlement over alleged accounts opened...

We would like to share some helpful advice on how to prepare for the upcoming 2017 proxy season. Following Michael Melbinger's blog on Tuesday (Say on Pay Frequency Vote in 2017), his clients wanted to know the rest of his tips and reminders for 2017 proxy season. The long form...

We want to share a Wall Street Journal article entitled, "Why Basing Executive Compensation on a Formula Doesn’t Work," that supports our message to clients that a formula isn’t the “end all, be all” approach for executive...

In this article, Cameco’s Jim Curtiss discusses several trends that will continue to impact compensation committees in the months ahead: 1) greater emphasis on transparency, 2) greater scrutiny of the CD&A, and 3) greater oversight from proxy...

We would like to share an article by Matthew Heller that discusses an Equilar survey that found CFO pay growth at S&P 500 firms is outpacing that of CEOs and performance-based equity is gaining...

In this Wall Street Journal article entitled, "EpiPen Maker Dispenses Outsize Pay", the author points out potential excessive pay (based on peer group) and aligning business decisions purely due to desired achievement of incentive plans versus company profits. Here is a...

The influence and scope of public company governance advisory firms like Institutional Shareholder Services (ISS) and Glass Lewis & Co (Glass Lewis) continue to widen. These firms continually shift policies and guidelines which in return keeps company management and board...

"Some of the country's best CEOs have had personal coaching, and that has contributed directly to their and the company's success. No one is perfect, and we all benefit from one-on-one feedback, peer assessment, mentoring, and motivating coaches and trainers. Boards should see...

Last week, the analysis we conducted for the Houston Chronicle (regarding compensation among the highest paid executives of Houston's publicly traded companies) was mentioned in an article on MySanAntonio.com entitled, "Executive Pay Still Rising Despite Energy's...

Because NASDAQ’s new golden leash disclosure requirement is effective, we would like to pass along this Gibson Dunn memo about how it intersects with the Form 8-K disclosure requirements. Please let us know if you have...

NFPCC Director, Kevin Kuschel, and Senior Consultant, Josh Whittaker, were recently quoted in an article entitled, "Job Openings Reflect Growing Confidence in Midstream...

As this Gibson Dunn blog states, ISS has posted its annual policy survey (here). The deadline is August 29th, and the big topics include: Dual-Class Companies, Say-on-Frequency, Pay-For-Performance & Non-TSR Financial Metrics, Director Tenure & Refreshment, and...

Each year, we here at NFP Compensation Consulting conduct an analysis for the Dallas Morning News on the top 100 highest-paid CEOs in the Dallas - Fort Worth area. Read...

Four recent, independent articles paint an interesting picture on the topic of binding Say on Pay votes. 1. The UK’s potential new prime minister, post Brexit, could move to a binding Say on Pay vote to curb CEO pay (read more here). 2. A recent article by Fortune, suggests...

While the upstream sector continues to struggle in the low oil price environment, RIGZONE's Valerie Jones explores possible opportunities in midstream. NFPCC's own, Kevin Kuschel (Managing Partner) and Josh Whittaker (Senior Consultant), were featured in her article entitled,...

An interesting read on Compensation Litigation! History may not always repeat itself but often times, rhymes. The Delaware Court of Chancery has issued an opinion on a Section 220 demand made against Yahoo which is very similar to the Disney case several years back. Disney...

SEC's Proposed Rules Requiring Member Companies to "Clawback" Excess Incentive-Based Compensation Article Written by Fulcrum Partners LLC MARKET TREND: There continues to be serious concern among regulators over the compensation of certain public company executives. The SEC's...

For companies subject to ISS’ United States policy, there are several changes to be aware of: Management Proposals • Director overboarding: o Subject to the one-year transition period described below, ISS will issue a negative vote recommendation on directors who are not...

It doesn’t always feel like it, but shareholder votes on executive compensation are actually non-binding. Today, it seems that shareholders’ voices are growing more and more influential and their “non-binding” votes are wielding more and more power. And unfortunately,...

The past three weeks has been a roller coaster for General Motors in the news.  The reason: the media doesn't understand executive compensation structures...again.  The issue of the gap between genders is a big one, and we do not mean to discredit it as being that...

Navigating the treacherous waters of regulatory reform and ensuring compliance with the countless rules and regulations imposed under the current administration places significant constraints on a company’s time and resources. Therefore, keeping up-to-date on current...

Update: Say-on-Pay and Say-on-Frequency Say-On-Pay As of April 11, 2011 there have been five companies that have failed the say on pay vote by shareholders: Jacobs Engineering (45.5%), Beazer Homes (46.1%), Shuffle Master Inc. (44.5%), Hewlett-Packard with a vote of 50 for and...

The increased scrutiny of executive compensation, resulting from both recently passed and pending legislation, as well as shareholder advisory group policies, will require regular updates to public company’s Compensation Committees. Although there are many issues that will...