Farient Advisors has been working closely with Institutional Investors and board members to help both groups better understand pay for performance alignment.
Working closely with both companies and major investors, Farient brings a unique expertise to understanding pay for performance alignment issues. We believe there is a growing convergence on pay for performance alignment, and have developed an approach to assessing alignment that provides clear and insightful analysis while also being intuitive and simple to use.
In 2011, a study from the Council of Institutional Investors (CII), prepared by Farient Advisors, found that “Pay for Performance Disconnect” was the #1 reason for “no” votes by institutional investors on Say on Pay. Now that we are in the thick of year three of Say on Pay, many of the pay disconnects have been minimized (tax gross ups, golden parachutes, single trigger change in control provisions, etc.).Investors are now laser focused on pay for performance alignment to ensure that the long-term objectives of both investors and management are protected. Over the past two years, the Farient Performance Alignment Reports™ (PARs) have become the pay and performance toolset that investors and boards are using to effectively and clearly analyze and engage on pay and performance alignment practices. By bringing together companies and investors, Farient is leading the charge in the development of a common language around alignment – one that can be shared among investors, compensation committees and management.