Farient Briefings: SEC’s PvP Rule Spurs Confusion

October 11, 2022

Farient newsletter header: Farient Briefings


In the News

Advisors to SEC: Postpone the PvP Rule, Please – Agenda

Image of city highrises at night with building lights illuminating the sky

In an interview with Agenda, Farient’s Marc Hodak says that despite the SEC trying to limit distortions in the disclosure with the recently passed pay-versus-performance (PVP) rule, confusion and frustration will likely result. Companies subject to SEC regulations for the 2023 proxy season are required to comply with the PVP rule amid growing backlash from businesses who have written to the SEC requesting a postponement. Letter signatories propose that the rule be delayed until all the issues, including the cost of implementation, can be fully understood. Access the full article below.

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Farient Brief

Executive Pay Increasingly Tied to DEI Goals

DEI Goals Diversity Equity Inclusion

Linking diversity, equity and inclusion (DEI) initiatives to exec pay isn’t going away anytime soon. Despite some pushback, tying executive pay to DEI goals rapidly continues. According to new Farient research, more than one out of every three S&P 500 companies now factor DEI into compensation, sending a signal of confidence in using DEI as a key performance measure.

In this newly published brief, Farient goes beyond the headlines to examine how:

  • Sectors differ in the use of DEI metrics
  • The prevalence of prospective vs. post-performance measures
  • The use of qualitative as opposed to quantitative reporting on DEI ambitions
  • The backlash from some investors and how legal challenges could put a chill on DEI in the future

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Where to Find Us

Farient Advisors' R.J. Bannister sits on a panel at the NACD Executive Compensation conference with experts

National Association of Corporate Directors (NACD) 2022 Summit – Ask the Experts: Executive Compensation

National Harbor, Maryland

Farient Partner and COO R.J. Bannister recently joined an expert panel exploring the latest compensation trends, including how others have adapted their compensation programs to respond to challenges, such as ESG and DEI, and how to align compensation strategy with long-term goals. Check out on-demand sessions from #NACDSummit here.

NACD Carolinas Chapter's Risk Management Agility and Resilience: The Board's Role event graphic

NACD Carolinas Chapter – Risk Management Agility & Resilience: The Board’s Role

Hybrid Event: Charlotte, NC In-Person and Online

October 27, 2022

The acceleration of risks ranging from supply chain management to cybersecurity, and the interaction between these challenges, has made it more important than ever for Boards to hold management accountable for preempting crises of all kinds. This in turn requires Boards to design compensation plans that hold executives responsible for risk management in a new age of uncertainty, while still incentivizing them to take appropriate business risks.

Join Farient’s Marc Hodak and his fellow experts at this NACD Carolinas interactive panel and dinner event for a discussion of how compensation plans can balance the needs of business in relation to sustainable risk management and exploring new avenues of growth. You can read more and register to attend in-person here, and to attend virtually here.

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