July 14, 2014

Proxy Season 2014: A Mid-Year Look at What’s Hot and What’s Not

We are currently midway through the year and beyond the 2014 proxy surge. In the fourth year of Say on Pay (SOP), we are wondering if this year is different from past years. So far in 2014, nearly 2,000 of the Russell 3000 companies have reported their SOP results. As shown in the chart below, there has been remarkably little difference in the year-to-date SOP voting results. Eighty-eight percent of companies received a >80% “For” vote, 10% received a 50-80% “For” vote, and 2% received a <50% “For” vote. The one caveat is that strong support one year does not guarantee support in subsequent years. However, companies that fail their SOP one year seem to find religion by correcting their pay practices to pass their votes the following year.

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May 13, 2014

Eyes Wide Open on Total Compensation

News stories about executive compensation abound as this proxy season reaches its crescendo, with such claims as “Executive Pay Is Too High,” Performance Goals Are Too Easy,” and “Executive Compensation Continues to Escalate.”  Now, as the 2014 proxy data are flowing in, total CEO pay appears to be on the decline. Or is it?

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March 11, 2014

Combined Chairman/CEO Roles: Easier Than You Think

In our work with shareholders and boards of directors, one question that has come up more than once in the last few months is “Should the chairman/CEO roles be split?” The common wisdom is that separating the roles serves up a better governance structure for shareholders because it provides a better balance of power. Further, the view is that the combined format has declined from almost 75 percent of S&P 500 companies having the combined roles in 2004 to just under 60 percent today and that, given this trend, we are inexorably headed to the minority having combined roles in the future. After all, this has been the corporate reality in Europe. And we have seen some very visible and acrimonious battles waged around splitting the roles.

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December 19, 2013

Larry vs. Larry: Oracle CEO Pay vs. Google CEO Pay

There are a number of similarities between Oracle and Google. Both are founder-led companies. Both are icons of technology. Both are highly successful. But when it comes to executive compensation, that’s when the similarity ends.

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November 13, 2013

Cisco CEO Pay: All Systems Go

Click here for a more comprehensive analysis in Farient’s Pay Tracker

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