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Thought Leadership — Canadian Insights | Meridian Compensation Partners, LLC | Executive Compensation Consulting

Canadian Insights

Relative TSR for Resource Companies: Does it Still Make Sense?

Similar to the U.S., Canadian institutional investors, such as the Ontario Teachers’ Pension Plan, with assets under management of ~$190 billion and an advocate for good compensation governance, have been pushing back on the use of relative TSR on the basis that this measure can reward management of “chronically underperforming” industries.

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Relative total shareholder return (relative TSR), the most commonly used performance share unit (PSU) measure, has recently been challenged by institutional investors. Earlier this year Ontario Teachers’ Pension Plan (OTPP) released an article entitled “Is Management Compensation Rewarding the Right…

10 Keys to Great Compensation Committee Processes

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Executive compensation is complex and institutional investors and proxy advisors are increasingly aggressive and prescriptive in their views of executive compensation. This makes the role of a public company compensation committee complex and demanding. It is now more important than…

Updates to ISS & Glass Lewis Compensation & Related Policies

Policy changes have implications for both equity plan voting and director over-boarding.

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ISS has changed its methodology for assessing treasury-based incentive plans with effect in 2016. In addition, both ISS and Glass Lewis have changed their standards for director “over-boarding” with effect in 2017. Equity Plan Voting As expected, ISS is introducing…

Modest Year over Year Increases in Canadian Director Pay

Even with this increase, Canadian directors are still paid less than their American counterparts on average.

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Director total compensation increased year over year, while equity held steady at just under one-half of director pay. This aligns with increases in director time commitments and expansion of the role of board members. Directors of Canadian companies continue to…

Horses for Courses

How compensation committees can choose the performance metrics that are right for their business.

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Incentive plans have two primary purposes: 1) To motivate behaviour and drive performance aligned with strategy and 2) To align rewards with shareholder interests. From these two simple purposes come the most difficult work of the compensation committee and an…

Poor Pay Practices in Good and Bad Times

Regardless of the state of the economy, there are always opportunities to improve pay practices.

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Most industries are confronted by a variety of compensation challenges, which can be exacerbated in good and bad economies. While many companies have eliminated problematic pay practices (tax gross-ups, stock option repricings, excessive perquisites, and aspirational peer groups) to respond…


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Review of Horizontal Benchmarking and Its Impact on CEO Compensation and Pay Disparity

Meridian’s Analysts Share Their Findings After Surveying Academic Studies And Compensation Trends And What They Have To Say About Horizontal Benchmarking And CEO Pay

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Executive Summary Introduction Meridian was asked by a group of six Canadian banks (“the Banks”) to review horizontal benchmarking and its potential impact on CEO Compensation and pay disparity to assist with their consideration of concerns raised in shareholder proposals.…

Effective Governance of Executive Compensation Benchmarking

Strong Governance and Benchmarking Play an Important Role in Keeping Accountability for Executive Pay Decisions

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Benchmarking is commonly used to set and assess executive pay levels and design practices. Strong compensation governance processes and careful development and use of benchmarking data are essential for HR Committees to critically evaluate executive pay. Executive pay decisions are…


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Regulatory and Governance Update

Recent Developments in Regulation Have Implications for Governance and Executive Compensation

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Canadian Developments There have been a number of recent regulatory and governance changes affecting executive compensation and governance. Mandatory Say on Pay Remains Unlikely The Canadian voluntary Say on Pay regime appears unlikely to change soon, although voluntary adoption continues…