In the 2012 issue of our special report, we offer a cursory glance of compensation trends (i.e. incentive plan designs, contractual agreements) and in-depth analysis of special topics (the effects of 2011 vote results, management transition agreements and self-selected peer groups, to name a few). Our examination of these notable subjects has proven to us, rather predictably, that say on pay’s sophomore year came with converging compensation practices as well as meaningful reform in response to the shareholder voice.
The report reveals that more companies than ever now rely on performance-based plans (61% companies utilized performance-based LTI plans in 2012) and benchmark pay to industry-based peer groups (most companies will choose at least 70% of its peer group from its industry). Companies who received a substantial amount of negative votes in the previous year were almost sure to present how they’ve engaged shareholders to identify any major concerns with pay programs in proxy filings, and a larger number are revamping their programs as a result.
Overall, companies seem more attendant to shareholder approval since say on pay’s maiden voyage, but the 2012 proxy season did not go without its fair share of outrageous pay packages in the midst of management overhaul or otherwise. Our season review includes spotlights on Citigroup, Chesapeake Energy, JC Penney, Motorola Mobility Holdings and more, all whom garnered extensive shareholder ire and media attention for incongruous annual pay packages, golden parachutes, or other egregious executive pay arrangements.
Glass Lewis clients can access the 2012 issue of Say On Pay Season Review at GlassLewis.net, or they can contact their Client Services Manager.
All others who wish to view the report can send a request to purchase the report via info@glasslewis.com