Insights

Current filters:

2018 Meridian Corporate Governance and Incentive Design Survey

For the eighth straight year, Meridian has conducted an extensive survey based on the public filings of 200 large cap companies (“Meridian 200”). This survey seeks to capture trends on a variety of executive compensation and corporate governance topics of interest to major companies today.

Posted by on

As companies review their executive compensation program designs and related corporate governance policies, current market practices and recent trends can provide competitive benchmarks that are helpful in understanding “best practices,” as well as facilitate productive boardroom discussions. Highlights of Meridian’s…

Should Companies Use Individual Performance Measures in Executive Annual Incentive Plans?

When evaluating whether including an individual performance component is appropriate, companies may want to consider some questions.

Posted by on

According to the Meridian 2017 Governance and Incentive Design Survey1, 43% of Meridian 200 companies use an individual performance component in their executive annual incentive plan, typically as a supplement to financial measures. Actual usage may be higher as the…

Pay Trends in the Financial Services Industry

Reprinted from the July/August 2018 issue of NACD Directorship magazine

Posted by and on

The financial crisis and recession may be history, but the impact these events have had on the financial services industry remains. Meridian Compensation Partners LLC, a consulting firm that serves clients on executive compensation and governance matters, has a dedicated…

Setting Goals to Incent High Performance

As seen in the 3rd Quarter 2018 issue of Bank Director

Posted by and on

High-performing banks define and execute their strategic vision by clearly articulating what they want to achieve and how they will do it. The old adage, “what gets measured, gets done”, is true when it comes to incentive plans. Companies that…

Preventative Care for Executive Compensation Programs

Reprinted from the May/June 2018 issue of NACD Directorship magazine

Posted by and on

In many cases, U.S. public companies receive a high level of support from shareholders for their annual advisory vote on the executive compensation program. Based on these results, companies often conclude there is no need to make any material changes…

Relative TSR Still Delivers Real Pay-for-Performance Alignment in the Oil & Gas Industry

Among the ten largest Oil & Gas production companies that have reported 2017-2018 compensation actions, each has either implemented or enhanced a financial returns metric for 2018 incentive compensation.

Posted by on

The menu of industry annual incentive metrics (and some long-term incentive metrics) now includes several instances of ROCE, Cash ROCE, ROIC, estimated wellhead returns, and other non-GAAP measures of investment returns. Investors may welcome the incentive accountability to financial returns,…

Managing Incentive Plans in a Cyclical Business

As seen in Corporate Board Member First Quarter 2018 - Compensation is always tricky, but it’s even tougher in an up-and-down business, where markets—as much as the managers—run the show. Jim Wolf, managing partner at Meridian Compensation Partners, offers advice on getting it right.

Posted by on

There is no more contentious, complex or difficult issue for boards than setting up the right incentives for executives. With companies in cyclical businesses that may have commodity costs as a large portion of performance, the challenge gets even more…

Addressing Compensation Issues In M&A

As seen in the 1st Quarter 2018 issue of Bank Director

Posted by and on

Consolidation in the banking industry continues, with more than 200 bank mergers in 2017. Whether your institution is a potential buyer or seller, there are several compensation matters that will need to be addressed proactively. Change-in-Control (CIC) Protections CIC arrangements…

House Passes Tax Reform Bill

On November 16th, the U.S. House of Representatives passed its tax reform bill by a vote of 227 to 205.

Posted by on

The tax reform bill approved by the full House does not substantively differ from the bill previously approved by the House Ways and Means Committee, as described in our Client Updates dated November 7, 2017 and November 10, 2017. Therefore,…

Best Practices for Restructuring Your Incentive Pay Plan

Watch Meridian Partner Marc Ullman on TK Kerstetter's Inside America's Boardrooms.

Posted by on

In this episode, Partner Marc Ullman joins host TK Kerstetter to discuss best practices for rethinking the incentive pay structure. With the goal of aligning pay and performance, Ullman outlines eight DOs and DON’Ts for today’s compensation committees. In addition…

2017 Trends and Developments in Executive Compensation

Meridian provides an overview of the current executive compensation and corporate governance landscape.

Posted by on

Executive Summary As detailed in Meridian’s prior Trends and Developments in Executive Compensation Survey (2015 through early 2016), several factors were driving change in the executive compensation landscape in the U.S. These factors included market volatility, turmoil in commodity prices…

Measuring E&P Capital Decisions in an Annual Incentive Plan is Complicated

Are E&P companies using the right metrics in their annual incentive programs?

Posted by on

There has been a lot of attention (both from the media and investors) focused on whether E&P companies are using the right metrics in their annual incentive programs. E&P companies have been criticized for a heavy focus on production and…

Rewarding Executives for Successful Bank M&A

Aligning rewards with value enhancement will help shareholders understand the rationale behind them.

Posted by and on

This article originally appeared on BankDirector.com. Mergers and acquisitions (M&A) can create significant value for shareholders. Accordingly, bank executives should be rewarded when completing and integrating successful transactions. However, in today’s environment of heightened executive pay scrutiny, some approaches to…

2016 Corporate Governance & Incentive Design Survey

Read Meridian's findings and learn about new market practices and trends that will inform best practices for the next year and beyond.

Posted by on

Executive Summary As companies review their executive compensation programs and related corporate governance policies, it can be helpful to understand common market practices and trends that may signal “best practices.” In order to inform these perspectives, Meridian’s 2016 Corporate Governance…

Effective Use of Discretion in Annual Incentives

Analyzing bonus payout outcomes of publicly traded E&P companies.

Posted by on

Going into 2015, annual incentive goal-setting was challenging for oil & gas companies, to say the least. E&P companies were wrestling with lowering production, where production growth is traditionally a cornerstone E&P bonus metric. Services and drilling companies were experiencing…

2016 Trends and Developments in Executive Compensation

Meridian provides an overview of the current executive compensation and corporate governance landscape.

Posted by on

The landscape of executive compensation and corporate governance is constantly evolving. Each year, Meridian identifies key developments regarding how companies respond to these ever changing conditions. (Read last year’s survey here.) Meridian’s 2016 Trends and Developments in Executive Compensation Survey…

Bank Regulators Issue New Proposed Rule on Incentive Compensation

The new rule applies to institutions with assets of $1 billion or more, and will likely go into effect in 2019.

Posted by on

The National Credit Union Administration is the first of a group of six federal bank regulators[1] to make available a joint proposed rule on incentive compensation arrangements maintained by financial institutions. Initially, these bank regulators issued a jointly proposed rule…

Annual Incentive Basics

Looking at how annual incentive plans are typically designed.

Posted on

The primary purpose of an annual incentive plan, also called an annual bonus plan, is to drive and reward behaviors that have an impact on the operating success of the company. Following is information on how such plans are typically…

Setting Incentive Plan Goals: Embrace Uncertainty!

Steps directors can take to keep incentive plans motivational in a climate of uncertainty.

Posted by on

The Holy Grail in executive compensation is to achieve strong alignment between pay and performance. In the quest to achieve this alignment, management teams and board members strive to design the perfect incentive structures, using the most appropriate performance measures…