The Demise of TSR as the Primary Executive Pay Performance Measure

Reprinted from NACD Directorship November/December 2018 Issue

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During the past decade, the use of total shareholder return (TSR) has risen rapidly in prevalence as a performance metric in executive long-term incentive plans. Many compensation committees believed this was a direct way to align executive pay and performance.…

Will Dodd-Frank and the CEO Pay Ratio Be Repealed?

A look at what the U.S. presidential election portends for the future of financial reform.

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It has been six years since the enactment of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which mandated that the Securities and Exchange Commission (SEC) develop rules intended to address the then-current financial crisis. One such rule concerns…

Proxy Named Executive Officers: Should Business Unit Heads Be Included?

Guidance is offered, based on a review of law and current market prevalence.

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To include business unit heads or not to include business unit heads; that is the question. Each year, public companies must determine which executives are named executive officers (“NEOs”) under the proxy disclosure rules. This determination is important, as public companies are required to disclose in their annual meeting proxies the compensation paid to each NEO (i.e., a company’s chief...

Dodd-Frank Disclosure

What to Expect From Dodd-Frank’s Pay Versus Performance Disclosure Requirement

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On September 18, 2013, over three years after the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”) was enacted, the Securities and Exchange Commission (”SEC”) completed one of four executive compensation-related requirements by releasing a proposed rule on Chief…