Walking the Incentive Tightrope: When Unpredictability Strikes | Farient Briefings
November 11, 2025
Walking the Incentive Tightrope:
When Unpredictability Strikes
Adjusting inflight incentive plans for top executives is a nuanced undertaking. As Farient’s Jarret Sues and Muskan Parnami write, shifts in organizational priorities due to a global crisis or an unexpected event can reshape performance metrics and prompt a reevaluation of compensation structures.
The challenge lies in ensuring that incentive adjustments reflect quantitative outcomes and uphold the organization’s credibility with transparency and sound governance while maintaining alignment with long-term strategic objectives. It’s often a delicate balancing act.
From Our Canadian Partner
Designing LTIPs in Practice: Case Studies from the Private Sector
Through three real-world case studies, Southlea Group explores how private organizations in different industries and of various sizes have tackled challenges in long-term incentive plan design. Whether preparing for succession, driving performance in a turnaround, or scaling a business amid market volatility, each case highlights the importance of strategic alignment, stakeholder engagement, and tailored solutions.
In the News
New Glass Lewis Approach Will Mean Changes for Say on Pay—Agenda
Farient CEO Robin A. Ferracone tells Agenda that “both ISS and the Glass Lewis traditional pay-for-performance tests are flawed in that they use the grant-date value of equity, not the [realizable] value of equity after performance has happened. Realizable values based on the compensation actually paid statistic in the pay-for-performance table will be a step forward.”
Glass Lewis’ upcoming shift to customizable policy recommendations marks a major change for the 2026 proxy season and beyond. The proxy advisor will introduce four research papers that offer different perspectives on compensation and other annual meeting items—management-alignment, governance fundamentals, active owners, and sustainability. This move away from a single benchmark recommendation will push boards to assess pay design through multiple lenses, raising questions about how compensation decisions will be evaluated.
Read more
Elon Musk’s Moonshot Pay Deal Spawned Copycats That Flopped—Bloomberg
Hoffmann’s comments come as Bloomberg examines the growing trend of massive performance-based equity plans inspired by Elon Musk’s 2018 Tesla award. While some CEOs have seen success, many—including leaders at Airbnb, Opendoor, and Farfetch—have failed to meet aggressive stock price targets, forfeiting billions in potential pay. As companies continue to experiment with these ultra-leveraged incentive plans, Hoffmann cautions that boards must balance ambition with realism—and weigh whether the risks truly align with shareholder value.
Where to Find Us
NACD Board Leadership Exchange
Compensation Committee Leader Exchange
Farient Advisors and EY partner with NACD on this exclusive invitation-only semi-annual directors’ forum. Farient Partner and COO R.J. Bannister will lead a fireside chat with Vanguard’s Soren Krupp, senior director, investment stewardship, on the linkages between incentives, talent, and risk.
New York City
November 19, 2025
2025 Directorship 100 Gala
Celebrating Excellence in Board Leadership
Farient’s Robin A. Ferracone and R.J. Bannister will be among the 100 honorees recognized for outstanding leadership in governance and the boardroom.
Cipriani
25 Broadway, New York, NY 10004
December 11, 2025
6-10 p.m.
For additional information on any of these events, please send an email to info@farient.com.
Understanding Climate Incentives
Exclusive: Around the globe, the heat is on to combat climate change while some political regimes denounce the veracity between greenhouse gas emissions and a warming planet. Nevertheless, large corporations are reporting Scope 1, Scope 2, and, increasingly, Scope 3 greenhouse gas emissions and linking reductions to executive compensation, according to Farient Advisors’ newly published 2025 Global Trends in Stakeholder Incentives: Climate Strategies and Incentives for Corporate Sustainability.
Learn more about how the world’s largest companies are setting and achieving climate goals by linking climate measures to executive incentives by sector and geography.
About Farient Advisors
Farient Advisors LLC, a GECN Group Company, is an independent premier executive compensation, performance, and corporate governance consultancy. Farient provides a full array of services linking business and talent strategy to compensation through a tailored, analytically rigorous, and collaborative approach. Farient has locations in Los Angeles, Newport Beach, New York, Louisville, and London and works with clients globally through its partnership in the Global Governance and Executive Compensation (GECN) Group. Farient is a certified diverse company and is recognized by the Women’s Business Enterprise National Council.
© 2025 Farient Advisors LLC. | Privacy Policy | Site by: Treacle Media