For CEOs, RSU Growth Swings Higher as Proxy Advisors Pull Back on Criticism—Agenda

Equity design is getting more nuanced. Farient Advisors Partner and COO R.J. Bannister’s message to boards: start with strategy, then build the pay mix to match.

In Agenda, Bannister explains why restricted stock units, performance shares, and stock options should not be treated as interchangeable tools. The right answer depends on what the company is trying to accomplish.

“Executives’ pay incentives ought to align with what the company strategy is and what it’s trying to accomplish as a business,” he said. “Companies that are trying to enter a high-growth phase may be more inclined to implement a higher level of stock options and PSUs into executives’ pay mix.” 

The takeaway: as proxy advisors move toward a more case-by-case view, compensation committees have more room to tailor long-term incentives—but also more responsibility to explain the strategy behind the choices.

About R.J. Bannister

Partner, COO, Farient Advisors/GECN Group, New York

New York: (646) 626-6929
Mobile: (917) 747-3985
rj.bannister@farient.com

R.J. has 30-plus years of experience consulting to the S&P 1500 and large private companies representing the board’s compensation committee or management, and sometimes both parties. R.J. has worked with hundreds of companies on their total rewards strategy and executive compensation philosophy to align pay programs with business strategy. His ability to create alignment results from deep insights on industry and compensation trends; sophisticated financial, market, and compensation analytics; and impactful, easy-to-implement solutions. He has worked in nearly every industry sector and extensively with private equity companies. Before joining Farient, R.J. was the founder and CEO of Bannister Group LLC, an executive compensation and total rewards consultancy he founded in 2019 after retiring as a managing director from Willis Towers Watson. R.J. holds an MSc in economics from the London School of Economics and a BS in economics from the University of Pennsylvania’s Wharton School with a triple concentration in corporate finance, strategic management, and international political science.

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