Latest Insights & Industry Trends

Our survey team at NFPCC has designed an incentive compensation survey for the Oil & Gas industry to provide competitive market practices in both annual and long-term incentive compensation plan designs. Specifically, the survey will report on incentive plan eligibility,...

While CEO pay has been a hot topic for many years, it has come back into the spotlight after the House of Representatives recently voted to repeal the Dodd-Frank legislation. Critics are complaining that transparency is necessary to lower CEO pay, but we are sharing this Fortune...

NFP Compensation Consulting' President, Chris Crawford, was quoted in this recent article from the Houston Business Journal discussing why it "pays" to live in Houston. Written by Jack Witthaus, the article highlights various roles and expert rationale on why they either earn...

Carefully drafted incentive compensation plans can improve executive loyalty. It's a good idea to make sure your executives are protected, and there are a lot of variables to consider in putting together incentive compensation plans. This article discusses options like cash or...

The Say-on-Pay failure rate is the lowest it's been since voting began in 2011. According to this Semler Brossy chart, the failure rate is at 0.6%, and only seven Russell 3000 companies have failed thus far in 2017. Need help preparing for the next annual say on pay vote? Ask...

We found and wanted to share this recent Forbes article rehashing an interesting discussion from five leading governance experts on the topic of effective governance strategies. While concluding that best practices are not “one size fits all”, the article highlights some key...

One of the biggest issues facing boards today is setting goals for incentive plans. How do companies find that balance between motivating executives, aligning with the company's strategic goals, and satisfying shareholders? This article by ClearBridge analyzed the goals for...

We want to share this podcast interview with our readers. Ann Yerger, a fellow expert in our industry, shares about the evolution of corporate governance that she has seen over her 30-year career. Listen to the audio interview...

Board independence is an increasing focal point for investors, proxy advisors and corporate issuers, especially now as companies go through their annual shareholder meetings. With that in mind, we thought this article from the Financial Times relevant for our community as it...

We believe this article by Harvard regarding cybersecurity for boards is worthwhile for our readers. When it comes to the board's role in risk oversight, it is imperative for directors to stay ahead of the curve. Since it can be difficult to identify upcoming risks, this article...

We found this article and thought our readers might be interested in why executive pay gets a bad rap. The media typically looks at a total compensation number and reports it without the appropriate context, so it’s easy to understand why executive pay is often...

For an unprecedented seventh year in a row, NFP Compensation Consulting was named one of the 2017 Best Companies to Work for in Texas. Out of the 100 companies given this distinction, NFPCC landed in the top 10 this year. Established in 2006, this awards program is a project of...

Harvard Law's Board Practices Study focuses on traditional board issues and also those which have recently heightened shareholder interest in the boardroom. Governance continues to evolve, but investor focus has been placed on the role of the board as the company's...

We came across a recent report that we thought would be interesting to our readers. With the debate growing on whether or not TSR measures are the best approach for performance-based long-term incentives, this study highlights and discusses some other metric alternatives and...

NFP Compensation Consulting' President, Chris Crawford, was quoted in the Houston Chronicle's recent article entitled, Four Houston Oil Companies Lifed CEO Pay in 2016. He states, "2017 Proxy statements are being filed, disclosing executive compensation for the last year. Trends...

With the 2017 proxy season upon us, this article from Boardroom Resources discusses best practices for communicating two critical components within the CD&A: peer group selection and board composition. While there’s no one-size-fits-all approach for either disclosure, this...

"Compensation committees face a full agenda in the first quarter of every new year. We outline four guiding perspectives or data points that all committees should consider as they set compensation goals. Now in the thick of Q1, compensation committees tend to find themselves...

Interesting article. However, a few additional points to complete the compensation picture. One, there is no reference to actual pay received as tied to stock price performance. Rather, this is a reference to the summary compensation table. Added, the summary compensation table...

The following excerpt was taken from a Harvard Business Review article in March of 2017. How do you think boards should evaluate themselves? "The New York Stock Exchange requires that the boards of all publicly traded corporations conduct a self-evaluation at least annually to...

"When an organization fails because of executive malfeasance, it generates a lot of attention. But such situations are actually relatively rare. It’s much more common, though less talked about, for organizations to fail because of ungoverned incompetence. That is, someone does...

"Executive compensation has always been a difficult topic and as executive wages have grown rapidly since the financial crisis, while the wages of the average worker have stagnated, the debate around executive compensation has only become fiercer. Companies have responded to the...

"In the next four years, nonprofit boards will face exceptional challenges affecting long-term financial and operational sustainability. It is likely that governmental grants will substantially decline. Business/individual donor gifts can be reduced should the economy teeter...

"Donald Trump will order a sweeping review of the Dodd-Frank Act rules enacted in response to the 2008 financial crisis, a White House official said, signing an executive action Friday designed to significantly scale back the regulatory system put in place in 2010. Trump also...

Our consultants took a keen interest when the IRS updated its golden parachute payment qualification requirements. Our 280g calculation & qualification experts continue their advisory role for businesses including audit support for CPAs. Check out these IRS audit tips from BNA...

Paul Gryglewicz, a senior advisor at Global Governance Advisors, shares his thoughts and advice on how to increase shareholder engagement in preparation for Say on Pay votes. "2017 marks a milestone year in terms of Say on Pay in the United States, as the first six-year 'say...

"Board of Directors pay continues its upward trend according to a study published by Total Compensation Solutions (TCS). The Board compensation report shows increases of approximately 7 to 8 percent from last year for annual retainers for the Chairman, and Regular Board Members...

Companies, shareholders and boards of directors want to ensure alignment of pay and performance to justify the often-high accompanying price tag of executive compensation. To provide context on the correlations between awarded, realizable and actual pay earned under...

An interesting topic to discuss from an article on Value Walk, highlighting the distance between ISS and say on pay recommendations under certain conditions. Although there is a high percentage of correlation between investor voting and ISS, the percentage declines dramatically...

"In order to understand the financial performance measures, target goals, performance ranges, and payouts of an annual incentive plan, we analyzed the proxy-disclosed practices of approximately 100 manufacturing and materials companies. We assessed year-over-year (YOY) trends in...

"Political swings, global volatility, technology innovations and investor expectations will require deeper board engagement. Drawing on interactions with corporate directors and business leaders as well as insights from its research, the KPMG Board Leadership Center has...

Check out this interesting read regarding the new say on pay rules, form 10-k summaries, and a guide for proxy season. "As another year comes to a close, it is time for public companies to become acquainted with the securities law and business developments of the past year...

"2016 was a year marked by significant changes—stunning political upheavals via Brexit and our own controversial new President-elect; a growing number of big-ticket, multi billion dollar M&A deals amid massive enterprise court battles, particularly in the technology...

Wilkins Finston Friedman Law Group “wrapped up” the year 2016 with their predictions of the benefit issues employers will face in 2017. Here are their top four benefit issues for 2017: •Health Care Reform. Speculation is rampant as to the extent of the upcoming changes...

"Board director compensation levels for middle market companies kept pace with the economy between 2014 and 2015, according to a new report from BDO USA, LLP, a leading accounting and consulting organization. Following years of solid increases, compensation remained relatively...

"The criteria for earning short-term incentive (STI) compensation appear to have entered a state of flux, judging by new research from the CFO Alliance. In particular, some companies are putting non-financial metrics, like customer or employee satisfaction, into the mix. But far...

ISS has published the U.S. Frequently Asked Questions for Equity Plan Compensation, Executive Compensation, Pay-for-Performance Mechanics, and U.S. Peer Selection (available here). In addition, an updated PFP white paper to reflect the new financial performance alignment test...

"Are chief executive officers worth their pay? Apple CEO Tim Cook's $10 million in compensation isn't chump change, but it's a bargain when you compare that to the company's massive average economic profit over the last three years. Other companies pay their CEOs much more, but...

"Equilar’s Compensation Committee Forum covered topics from regulatory updates to peer group selection and Say on Pay. The realm of executive and director pay is a tumultuous one. Whether preparing for the impending CEO Pay Ratio or anticipating the regulatory changes ahead,...

"Last month, the IRS provided helpful guidance under Code Section 409A with the release of its Chief Counsel Advice 201645012 (the CCA). The CCA is noteworthy because the IRS agreed that a 25% increase qualified as a materially greater amount, and thus deferred salary was...

2015 middle market executive compensation trends foreshadowed momentum companies are seeing in 2016. In Q2, the National Center for the Middle Market reported 7.2 percent revenue growth over the previous year, and while companies entered the year with some caution, 2015 pay...

One thing is for certain, the results of the election created a myriad of questions regarding the future of American politics. Less certain, though, is the level of impact the results will have on the futures of various executive compensation and corporate governance policies...

Sandra Pace, Managing Partner, Steven Hall & Partners, and Michael Sherry, CECP, Consultant, Steven Hall & Partners, discuss why organizations may be struggling to maintain their incentive programs, emerging considerations, pitfalls, and best practices. View the video...

Institutional Shareholder Services (ISS) announced a number of important updates relating to its 2017 pay-for-performance evaluation for U.S. and Canadian companies. The headlines are: ISS will evaluate companies’ performance relative to peers on six financial metrics, and...

"Whether you’re looking at a mutual fund or company stock, you want to see the management team having a significant amount of their own 'skin in the game' through a large commitment of personal financial resources. While this doesn’t guarantee success, at least you know the...

On October 18, 2016, the staff of the Division of Corporation Finance of the Securities and Exchange Commission published five new Compliance & Disclosure Interpretations (CDIs) related to CEO pay ratio disclosures. The CDIs provide some clarity on how companies can begin...

Here are some trending hot topics in executive compensation, written by Brad Smith at Findley...

Institutional Shareholder Services Inc. (“ISS”), the influential proxy advisory firm, recently released their 2016-2017 Global Policy Survey results. These results show some interesting findings related to executive compensation and may signal the future of ISS policies...

This presentation by NFP Compensation Consulting will identify the differences of today's workforce with four very different generations of Workers: Baby boomers, Gen X, Millennials & Gen Z. The discussion will include what motivates the different generations along with the...

"Over the past two years, a growing number of U.S. banks has capped their directors' earnings, but the ceilings are so high that they primarily serve to fend off potential shareholder litigation rather than control the pace of pay increases. Most of the caps are typically 2-3...

New compensation and governance standards are impacting boards of directors in all industries, but even more so in banking, which has more regulatory requirements and is under greater scrutiny. The recent Wells Fargo & Co. $185 million settlement over alleged accounts opened...