Over the past year, COVID-19 has been the driving force behind shifting trends in corporate governance. With large unemployment rates at the beginning of the pandemic (13.8% in May 2020), a declining stock market and vast uncertainty, it has been a historical time to track whether the world’s most powerful executives would feel similar effects to the rest of the population. At the start, it seemed that they would. Executive compensation took a slight hit with CEO pay cuts and changes to long-term incentive plans, but the overarching question remained unanswered: Were these changes significant enough to align with the world’s hardships, or were companies more focused on retaining their highest-paid employees? With 2021 Say on Pay votes well underway, data surrounding executive compensation approval may provide an answer to this question and display if COVID-19 increased the disconnect between the boardroom and shareholders.

Equilar’s early look at 2021 Say on Pay results highlighted that out of the 43 companies in the Equilar 500 with disclosed votes, around 20% received under 70% approval (considered a failure by proxy advisory firm ISS). As of May 20, 247 Equilar 500 companies held their annual meetings with 8.9% in the under 70% mark and 3.6% receiving under 50%, or a failed vote.

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