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Trends in the 2013 U.S. Proxy Season
Say on Pay Today
Strong Overall Support
Despite close scrutiny of ex...
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[Infographic]: Trends in the 2013 U.S. Proxy Season - Towers Watson

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This infographic highlights key trends in say-on-pay voting and how companies are responding to the risk of low say-on-pay support, based on a Towers Watson Executive Compensation Resources analysis of Russell 3000 companies reporting say-on-pay vote results through the end of June.

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[Infographic]: Trends in the 2013 U.S. Proxy Season - Towers Watson

  1. 1. towerswatson.com Trends in the 2013 U.S. Proxy Season Say on Pay Today Strong Overall Support Despite close scrutiny of executive pay in year three of mandatory say on pay, the vast majority of U.S. companies continue to enjoy strong shareholder support for their executive pay programs. The Implications of Standing Out Responding to Low Say-on-Pay Support Companies understand the risks of standing out from the crowd in today’s environment. Companies receiving less than 80% shareholder support are taking action to enhance their vote results. 72% reached out to shareholders to discuss their concerns. Most common changes made to compensation programs after below-average say-on-pay vote: Amended or added stock ownership guidelines Enhanced CD&A to add details and improve transparency Modified pay benchmarking peer group Eliminated excise tax gross-ups Granted new long-term performance awards Adjusted compensation mix Used more rigorous incentive plan metrics23% 23% 21% 20% 18% 16% 16% made changes in their pay programs. 68% For more information, contact your local Towers Watson consultant or visit our blog, Executive Pay Matters, at http://www.towerswatson.com/Insights/Newsletters/Global/executive-pay-matters. Companies with high pay opportunities (above the 67th percentile were more than 3Xas likely to receive low say-on-pay support (below 70%). Companies receiving negative say-on-pay vote recommendations from Institutional Shareholder Services (ISS) got 29% less support, on average.* Pay-for-performance disconnects were the leading cause of negative ISS vote recommendations, cited 79%of the time.* Say-on-Pay Vote Frequency: Russell 3000 82% of companies are holding annual say-on-pay votes, including over half of those that initially proposed triennial votes. 17% Triennial 1% Biennial 82% Annual *Source: Institutional Shareholder Services had failing say-on-pay votes (and just 1% of the Fortune 500). average level of shareholder support for 2013 say-on-pay votes. of Russell 3000 companies received over 70% support.92% 90%Only 2%

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