Proxy Season Say-on-Pay Review

Laura Elmore and Brian Myers are consultants and Henry Mbom is a senior associate at Willis Towers Watson. This post is based on their Willis Towers Watson memorandum. Related research from the Program on Corporate Governance includes Paying for Long-Term Performance by Lucian Bebchuk and Jesse Fried (discussed on the Forum here).

Executive Summary

2019 by the numbers so far

2019 Say-on-Pay Snapshot

Source: Willis Towers Watson Global Executive Compensation Analysis Team analysis of 1,944 Russell 3000 companies from January 1, 2019 to July 12, 2019 and 2,230 Russell 3000 companies reporting results in 2018. ISS recommendations confirmed using ISS’s Governance Analytics.

Strong Shareholder Support Remains the Norm

The trend of 90%+ support continues

Source: Willis Towers Watson’s Global Executive Compensation Analysis Team

Shareholder Support and Proxy Advisor Recommendations

Source: Willis Towers Watson’s Global Executive Compensation Analysis Team. ISS recommendations were confirmed using ISS’s Governance Analytics.

Pay-for-Performance Concern

Source: Willis Towers Watson’s Global Executive Compensation Analysis Team review of 227 Russell 3000 companies that received a high concern for pay for performance and a negative recommendation for say on pay (The 227 companies include proposals with pending vote results). Institutional Shareholder Services’ (ISS) areas of concern confirmed using ISS’s Governance Analytics.

36 Companies Have Failed Say on Pay for the First Time So Far in 2019

Source: Willis Towers Watson’s Global Executive Compensation Analysis Team review of 36 Russell 3000 companies that failed say-on-pay for the first time. Institutional Shareholder Services’ (ISS) areas of concern confirmed using ISS’s Governance Analytics

2019 S&P 1500 Equity Plan Voting Results Snapshot

Source: Willis Towers Watson Global Executive Compensation Analysis Team analysis of 242 S&P 1500 companies that had a new or materially amended plan with voting results from January 1, 2019 to July 12, 2019 and 279 companies in 2018. Institutional Shareholder Services’ (ISS) recommendations confirmed using ISS’ Governance Analytics.

2019 Say-on-Parachute Snapshot

Source: Willis Towers Watson Global Executive Compensation Analysis Team analysis of 29 Russell 3000 companies holding a say-on-parachute vote from January 1, 2019 to July 12, 2019 and 81 Russell 3000 companies reporting results in 2018. Institutional Shareholder Services’ (ISS) recommendations confirmed using ISS’s Governance Analytics

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