Covid-19 placed an unparalleled disruption to nearly all companies’ operations at the start of 2020 and created persistent challenges throughout the rest of the year and into 2021. Compensation committees made numerous reactive changes to the incentive programs of their respective companies in an attempt to navigate through the challenges of executive compensation during an unprecedented year. Additionally, the accelerated spotlight on ESG-related governance has increased the expectations of compensation committees and compensation programs. These factors have contributed to a higher-than-expected failure rate in 2021.
Although almost one-third of Russell 3000 failures were due in part to Covid-related pay actions, the increase in failures over last year are also due in part to problematic pay practices (12% increase year-over-year) and special awards (22% increase year-over-year).
This webcast provides highlights from a September 2021 Boardroom Summit panel featuring Kathryn Neel, managing director for Semler Brossy, Ray Cameron, Head of Investment Stewardship – the Americas at BlackRock, and Diana Lee, Director, Corporate Governance and ESG Analyst, Responsible Investing at AllianceBernstein. Ray and Diana share their observations and key takeaways from the 2021 proxy season Say on Pay results and how the pandemic impacted how their firms evaluated Say on Pay proposals in 2021.