The document discusses trends in CEO pay from 2010-2014. Some key findings include:
1. Median total compensation in the S&P 1500 increased from $4.0 million in 2010 to $5.3 million in 2014, driven largely by increases in stock awards.
2. Performance-based stock awards saw the largest growth from 2010-2013, increasing 38.1% in the S&P 1500, but appeared to plateau in 2014.
3. Options decreased substantially over the period, with the median value in the S&P 1500 falling from $346,600 in 2010 to $19,857 in 2014.
4. Equity compensation made up over half of total pay on average
The document discusses the current and proposed bonus systems for managers at Industrial Electronics, Inc. (IE). The current system bases bonuses on company profits above 12% of net worth, but provided no bonuses in 2000-2001 due to recession. The proposed system bases bonuses on division/group/corporate economic profits compared to targets. It charges managers for tied-up assets and does not consider financing. While more controllable and using residual income, the proposed system also has shortcomings like not linking bonuses to strategy and providing room for gamesmanship.
WSJ Hay Group 2014 CEO compensation studySteve Sabow
- CEO pay increased in 2014, with total compensation rising 4.1% to $3.7 million and long-term incentive grants increasing 5.6% to $8.1 million. Companies made changes to pay mixes, increasing the portion tied to performance in response to shareholder feedback.
- Shareholder returns were strong in 2013 and solid in 2014, with total shareholder returns of 34.6% and 16.6% respectively. Company financial performance also increased, contributing to higher CEO pay.
- Shareholders continue to prefer more compensation being tied to long-term performance, leading to performance awards becoming the largest part of the pay mix for CEOs.
The relationship between activity based,Arfan Afzal
The Relationship between Activity BasedCosting, Perceived Environmental Uncertaintyand Global Performance
The aim of this paper is to present the main results of an empirical study done in Morocco and highlight the impact of the PEU on the ABC implementation and its performance according to the perceived environmental uncertainty (PEU).
CFA Research Team 1 initiates coverage of Esterline Technologies Corporation with a HOLD recommendation and $83 one-year price target. Key points include: ESL has limited organic growth potential and relies on acquisitions for growth; valuation models indicate a fair value of $83 per share, making it slightly underpriced; management aims to increase operating margins but progress has been slow; main risks include cuts to defense spending and economic downturns. The recommendation is based on limited long-term aerospace growth prospects and bounded benefits from ESL's acquisition strategy.
The document provides an overview and analysis of equity grant trends among S&P 1500 companies from 2010 to 2014. Some key findings include:
1) The percentage of companies granting performance equity increased from 51.7% in 2010 to 69.3% in 2014, while the percentage granting options declined from 75.6% to 60.7% over the same period.
2) Restricted stock became the dominant equity vehicle, with 37.9% of companies granting it exclusively in 2014 compared to 22.3% in 2010. Median restricted stock granted and outstanding both increased over 20% from 2010 to 2014.
3) Technology companies granted the most restricted stock, while industrial companies granted the least. Median options
- The document analyzes the ratio analysis of Amara Raja Batteries Limited over 5 years from 2009-2014.
- Key ratios like current ratio, quick ratio, total debt ratio, and debt-equity ratio are calculated from the company's annual reports.
- Current ratios were above 2:1 standard except in 2011-2012. Debt ratios increased over time, showing a rising dependence on debt financing rather than equity.
Impact of Leverage on Profitability: A Study of Sabar DairyRHIMRJ Journal
The document discusses leverage and its impact on the profitability of Sabar Dairy from 1985-86 to 2013-14. It analyzes the relationship between various profitability ratios (return on capital employed, return on equity, return on assets, earnings per share) and different types of leverage (operating, financial, total). The results found positive relationships between the ratios and leverage types, though the coefficients were not statistically significant in most cases. Overall, the study concluded that Sabar Dairy has made satisfactory use of operating, financial and total leverage.
The document discusses the current and proposed bonus systems for managers at Industrial Electronics, Inc. (IE). The current system bases bonuses on company profits above 12% of net worth, but provided no bonuses in 2000-2001 due to recession. The proposed system bases bonuses on division/group/corporate economic profits compared to targets. It charges managers for tied-up assets and does not consider financing. While more controllable and using residual income, the proposed system also has shortcomings like not linking bonuses to strategy and providing room for gamesmanship.
WSJ Hay Group 2014 CEO compensation studySteve Sabow
- CEO pay increased in 2014, with total compensation rising 4.1% to $3.7 million and long-term incentive grants increasing 5.6% to $8.1 million. Companies made changes to pay mixes, increasing the portion tied to performance in response to shareholder feedback.
- Shareholder returns were strong in 2013 and solid in 2014, with total shareholder returns of 34.6% and 16.6% respectively. Company financial performance also increased, contributing to higher CEO pay.
- Shareholders continue to prefer more compensation being tied to long-term performance, leading to performance awards becoming the largest part of the pay mix for CEOs.
The relationship between activity based,Arfan Afzal
The Relationship between Activity BasedCosting, Perceived Environmental Uncertaintyand Global Performance
The aim of this paper is to present the main results of an empirical study done in Morocco and highlight the impact of the PEU on the ABC implementation and its performance according to the perceived environmental uncertainty (PEU).
CFA Research Team 1 initiates coverage of Esterline Technologies Corporation with a HOLD recommendation and $83 one-year price target. Key points include: ESL has limited organic growth potential and relies on acquisitions for growth; valuation models indicate a fair value of $83 per share, making it slightly underpriced; management aims to increase operating margins but progress has been slow; main risks include cuts to defense spending and economic downturns. The recommendation is based on limited long-term aerospace growth prospects and bounded benefits from ESL's acquisition strategy.
The document provides an overview and analysis of equity grant trends among S&P 1500 companies from 2010 to 2014. Some key findings include:
1) The percentage of companies granting performance equity increased from 51.7% in 2010 to 69.3% in 2014, while the percentage granting options declined from 75.6% to 60.7% over the same period.
2) Restricted stock became the dominant equity vehicle, with 37.9% of companies granting it exclusively in 2014 compared to 22.3% in 2010. Median restricted stock granted and outstanding both increased over 20% from 2010 to 2014.
3) Technology companies granted the most restricted stock, while industrial companies granted the least. Median options
- The document analyzes the ratio analysis of Amara Raja Batteries Limited over 5 years from 2009-2014.
- Key ratios like current ratio, quick ratio, total debt ratio, and debt-equity ratio are calculated from the company's annual reports.
- Current ratios were above 2:1 standard except in 2011-2012. Debt ratios increased over time, showing a rising dependence on debt financing rather than equity.
Impact of Leverage on Profitability: A Study of Sabar DairyRHIMRJ Journal
The document discusses leverage and its impact on the profitability of Sabar Dairy from 1985-86 to 2013-14. It analyzes the relationship between various profitability ratios (return on capital employed, return on equity, return on assets, earnings per share) and different types of leverage (operating, financial, total). The results found positive relationships between the ratios and leverage types, though the coefficients were not statistically significant in most cases. Overall, the study concluded that Sabar Dairy has made satisfactory use of operating, financial and total leverage.
This Project deals with the comparative study of 2 companies listed in S&P 500 for their performance evaluation & ratio analysis for the 3 financial years.
The document discusses ratio analysis, including identifying five common classes of ratios: liquidity, solvency, activity, profitability, and operating. It provides examples of common ratios within each class, such as current ratio and debt-to-equity ratio. The purposes of ratio analysis are also summarized, such as allowing managers to monitor performance and creditors to evaluate business solvency. Limitations of ratio analysis are noted.
This document appears to be a project report submitted for a Master's degree in Business Administration. It includes an introduction to ratio analysis, definitions of key terms, and outlines various types of ratios that will be analyzed in the report such as liquidity, activity, profitability, and leverage ratios. The objectives of the study are to analyze the financial position and performance of the company through ratio analysis and suggest measures to improve performance.
Employee Benefits in the Obamacare World & How to Maximize Its ImpactJoseph Appelbaum
Are you struggling to understand Obamacare and how it impacts your company? Do you want to learn about how to use employee benefits as a recruitment and retention tool?
This presentation will provide valuable insight into employee benefits in the Obamacare world and how to maximize its impact. Under Obamacare, employers are offered the option to "pay or play." But, for most companies there is no choice—they must “play” in order to recruit and retain employees. This not only includes offering health insurance but also life, disability, and the whole spectrum of employee benefits.
Here you'll learn about the impact of Obamacare on the employee benefits mix and employer decision-making process, along with understanding the importance of insurance benefits as a mandatory piece of the total compensation puzzle.
The document discusses how pension plan sponsors should consider the impact of capital market assumptions and investment strategies on the sponsoring company's financial performance and ability to meet pension obligations. It argues that pension strategies are often not customized based on the unique risks faced by different companies. An effective approach is to evaluate operational, financial, and pension risks, and stress test potential investment strategies while modeling corporate financial performance under different economic scenarios. This provides a more tailored strategy that considers both pension asset volatility and the sponsor's risk tolerance.
The proxy fight for board seats at Oshkosh Corporation is underway, with Icahn Associates nominating six directors. While OSK's stock performance has lagged peers, the company has significant defense business exposure. Icahn will argue OSK has failed to execute on acquisitions or develop business segments. Shareholders will evaluate if change is needed and if Icahn's nominees can add value, considering four have Icahn ties raising independence questions.
1) Four key issues that may affect executive compensation programs are: the evolution of say on pay votes, the impact of share buybacks on performance measures like EPS, the influence of activist investors and zero-based budgeting, and increased scrutiny on retirement and deferred compensation payments.
2) Say on pay votes and proxy advisory firms like ISS have slowed executive pay growth and pushed for more performance-based long-term incentives. Many companies now base executive bonuses on EPS targets but this may be improperly influenced by share buybacks.
3) Activist investors are pushing companies to improve shareholder value through tactics like zero-based budgeting, which may impact how companies set goals in executive incentive plans.
This document is a project report submitted by Arindam Barman analyzing the financial statements of Reliance Industries Limited over the past four years. It includes an introduction outlining the purpose and importance of financial analysis. The document then discusses various tools used for financial statement analysis, including ratio analysis, funds flow analysis, and cash flow analysis. It focuses on explaining ratio analysis in detail and its importance for evaluating a company's liquidity, profitability, leverage, operational efficiency, and overall financial health.
This document discusses CEO remuneration in India. It provides an overview of corporate governance and compensation components. It then lists the highest and lowest paid CEOs in India in 2013-2014. On average, CEOs in India earn 3.3 million rupees per year. The document discusses factors that influence CEO pay such as experience, location, and related job salaries. It also discusses issues around pay inequity, pay for performance, and efforts to reform compensation.
This document discusses a study analyzing the influence of debt to equity ratio, inventory turnover, and current ratio on return on equity for pharmaceutical companies listed on the Indonesia stock exchange. It provides background on each variable and discusses relevant literature. The study uses a sample of 8 companies and analyzes the variables using multiple linear regression. The results found that debt to equity ratio did not significantly influence return on equity individually, but inventory turnover and current ratio did significantly influence it individually. Together, the three variables were found to significantly influence return on equity.
This document summarizes current trends in association compensation based on survey data from the National Association of Manufacturers Council of Manufacturing Associations (NAM CMA). Key findings include an increase in median operating budgets and CEO compensation levels among survey participants from 2010-2013. The majority of associations provide incentive compensation and defined contribution retirement plans to their CEOs. The document discusses approaches to defining compensation peer groups and using market data to set executive pay levels. It also notes trends toward greater governance and documentation of executive compensation decisions.
Midsized businesses play an important role in the recovering U.S. economy. The Association for Corporate Growth (ACG), for example, reports that while midsized businesses represent just 1% of all businesses, they provide 26.5% (48 million) of all U.S. jobs. Review this whitepaper and learn about the three key themes which emerged in the study results - employee engagement, talent management, and compliance.
This document summarizes the findings of PwC's 2015 Stock Compensation Assumption and Disclosure Study. Some key findings:
- Large companies rely heavily on the Black-Scholes model for stock option valuation, while high tech companies rely almost exclusively on it.
- Both groups saw decreases in stock price volatility assumptions and increases in risk-free interest rate assumptions from 2013 to 2014.
- The mix of equity awards has shifted from stock options to restricted stock over time for both groups. Restricted stock now makes up a larger proportion of total grant value.
- Median stock compensation expenses as a percentage of income decreased for both groups from 2013 to 2014.
in this presentation we discussed about basic of ratio, types of ratio, comparison of ratios of hul and itc limited.
some ratios and graphs are taken from moneycontrol.com
1. The document is a student's project report on the financial ratio analysis of Wipro. It includes an acknowledgment section thanking various professors and institutions for their support and guidance.
2. There is a declaration by the student stating that the project is their original work and submitted for their Master's degree program.
3. The project contains a certificate from the student's teacher guide confirming they completed the research project on the given topic under their guidance.
Salary reductions presentation june 2020 with formattingArt Amler
The document discusses salary reduction data during the COVID-19 pandemic. It provides examples of companies that have implemented salary reductions for employees at all levels, with higher reductions typically for higher-paid positions. Executive pay cuts ranged from 10-30% while front-line workers often saw reductions of 10% or less. Over 600 companies have announced salary reductions since the pandemic began, with the highest number of cuts occurring in April. Reductions have helped companies avoid layoffs in many cases.
2014 Compensation and Benefits Trends in the GCC ReportThe HR Observer
As the economic forecast for the region brightens up, many organisations are preparing for business growth and expansion. This has a great impact on the people operations in the business and especially on compensation and benefits to ensure employee pay and benefits are competitive to retain and engage top talent. The report summaries a GCC wide survey conducted with nearly 160 companies across many sectors. Respondents were asked to report on key pay indicators inside their companies in 2012 – 2014 to analyse major pay movements and trends. A trends analysis of various compensation and benefits instruments in the region including flexible benefits and employee wellness is then presented. The report also outlines the key strategic priorities for the profession in the next 3 years while forecasting some of the key challenges to C&B that come with growth
Ratio Anaylsis Of Nokia .. Adeel Ahmad WahlaAdeel Wahla
This document is a ratio analysis report submitted by a student for their M.Com program. It analyzes various liquidity, profitability, and leverage ratios for Nokia from 2013-2015. The liquidity ratios like current ratio and quick ratio fluctuate over the years. Gross profit margin, operating profit margin, and net profit margin all decreased in 2015 compared to previous years, indicating lower manufacturing efficiency and profits. Overall, the ratio analysis shows Nokia's financial performance weakened in 2015.
The document analyzes executive compensation trends among 50 companies that filed proxy statements between November 2014 and February 2015. It found that median CEO total compensation increased 15% from 2013 to 2014 due to higher annual and long-term incentive awards. 72% of companies had annual incentive payouts at or above target levels, and these companies demonstrated stronger financial performance. Companies continued shifting a greater portion of long-term incentives to performance-based vehicles while maintaining the use of time-based stock options and restricted stock. Say on Pay votes were majority approved for 98% of the companies analyzed.
The document discusses executive compensation practices at banks and financial institutions. It covers issues like pay freezes, incentive pay, performance metrics, restrictions on TARP recipients, calls for increased transparency and shareholder votes on compensation. It provides advice on selecting appropriate performance measures and ensuring compensation is tied to achieving goals.
This Project deals with the comparative study of 2 companies listed in S&P 500 for their performance evaluation & ratio analysis for the 3 financial years.
The document discusses ratio analysis, including identifying five common classes of ratios: liquidity, solvency, activity, profitability, and operating. It provides examples of common ratios within each class, such as current ratio and debt-to-equity ratio. The purposes of ratio analysis are also summarized, such as allowing managers to monitor performance and creditors to evaluate business solvency. Limitations of ratio analysis are noted.
This document appears to be a project report submitted for a Master's degree in Business Administration. It includes an introduction to ratio analysis, definitions of key terms, and outlines various types of ratios that will be analyzed in the report such as liquidity, activity, profitability, and leverage ratios. The objectives of the study are to analyze the financial position and performance of the company through ratio analysis and suggest measures to improve performance.
Employee Benefits in the Obamacare World & How to Maximize Its ImpactJoseph Appelbaum
Are you struggling to understand Obamacare and how it impacts your company? Do you want to learn about how to use employee benefits as a recruitment and retention tool?
This presentation will provide valuable insight into employee benefits in the Obamacare world and how to maximize its impact. Under Obamacare, employers are offered the option to "pay or play." But, for most companies there is no choice—they must “play” in order to recruit and retain employees. This not only includes offering health insurance but also life, disability, and the whole spectrum of employee benefits.
Here you'll learn about the impact of Obamacare on the employee benefits mix and employer decision-making process, along with understanding the importance of insurance benefits as a mandatory piece of the total compensation puzzle.
The document discusses how pension plan sponsors should consider the impact of capital market assumptions and investment strategies on the sponsoring company's financial performance and ability to meet pension obligations. It argues that pension strategies are often not customized based on the unique risks faced by different companies. An effective approach is to evaluate operational, financial, and pension risks, and stress test potential investment strategies while modeling corporate financial performance under different economic scenarios. This provides a more tailored strategy that considers both pension asset volatility and the sponsor's risk tolerance.
The proxy fight for board seats at Oshkosh Corporation is underway, with Icahn Associates nominating six directors. While OSK's stock performance has lagged peers, the company has significant defense business exposure. Icahn will argue OSK has failed to execute on acquisitions or develop business segments. Shareholders will evaluate if change is needed and if Icahn's nominees can add value, considering four have Icahn ties raising independence questions.
1) Four key issues that may affect executive compensation programs are: the evolution of say on pay votes, the impact of share buybacks on performance measures like EPS, the influence of activist investors and zero-based budgeting, and increased scrutiny on retirement and deferred compensation payments.
2) Say on pay votes and proxy advisory firms like ISS have slowed executive pay growth and pushed for more performance-based long-term incentives. Many companies now base executive bonuses on EPS targets but this may be improperly influenced by share buybacks.
3) Activist investors are pushing companies to improve shareholder value through tactics like zero-based budgeting, which may impact how companies set goals in executive incentive plans.
This document is a project report submitted by Arindam Barman analyzing the financial statements of Reliance Industries Limited over the past four years. It includes an introduction outlining the purpose and importance of financial analysis. The document then discusses various tools used for financial statement analysis, including ratio analysis, funds flow analysis, and cash flow analysis. It focuses on explaining ratio analysis in detail and its importance for evaluating a company's liquidity, profitability, leverage, operational efficiency, and overall financial health.
This document discusses CEO remuneration in India. It provides an overview of corporate governance and compensation components. It then lists the highest and lowest paid CEOs in India in 2013-2014. On average, CEOs in India earn 3.3 million rupees per year. The document discusses factors that influence CEO pay such as experience, location, and related job salaries. It also discusses issues around pay inequity, pay for performance, and efforts to reform compensation.
This document discusses a study analyzing the influence of debt to equity ratio, inventory turnover, and current ratio on return on equity for pharmaceutical companies listed on the Indonesia stock exchange. It provides background on each variable and discusses relevant literature. The study uses a sample of 8 companies and analyzes the variables using multiple linear regression. The results found that debt to equity ratio did not significantly influence return on equity individually, but inventory turnover and current ratio did significantly influence it individually. Together, the three variables were found to significantly influence return on equity.
This document summarizes current trends in association compensation based on survey data from the National Association of Manufacturers Council of Manufacturing Associations (NAM CMA). Key findings include an increase in median operating budgets and CEO compensation levels among survey participants from 2010-2013. The majority of associations provide incentive compensation and defined contribution retirement plans to their CEOs. The document discusses approaches to defining compensation peer groups and using market data to set executive pay levels. It also notes trends toward greater governance and documentation of executive compensation decisions.
Midsized businesses play an important role in the recovering U.S. economy. The Association for Corporate Growth (ACG), for example, reports that while midsized businesses represent just 1% of all businesses, they provide 26.5% (48 million) of all U.S. jobs. Review this whitepaper and learn about the three key themes which emerged in the study results - employee engagement, talent management, and compliance.
This document summarizes the findings of PwC's 2015 Stock Compensation Assumption and Disclosure Study. Some key findings:
- Large companies rely heavily on the Black-Scholes model for stock option valuation, while high tech companies rely almost exclusively on it.
- Both groups saw decreases in stock price volatility assumptions and increases in risk-free interest rate assumptions from 2013 to 2014.
- The mix of equity awards has shifted from stock options to restricted stock over time for both groups. Restricted stock now makes up a larger proportion of total grant value.
- Median stock compensation expenses as a percentage of income decreased for both groups from 2013 to 2014.
in this presentation we discussed about basic of ratio, types of ratio, comparison of ratios of hul and itc limited.
some ratios and graphs are taken from moneycontrol.com
1. The document is a student's project report on the financial ratio analysis of Wipro. It includes an acknowledgment section thanking various professors and institutions for their support and guidance.
2. There is a declaration by the student stating that the project is their original work and submitted for their Master's degree program.
3. The project contains a certificate from the student's teacher guide confirming they completed the research project on the given topic under their guidance.
Salary reductions presentation june 2020 with formattingArt Amler
The document discusses salary reduction data during the COVID-19 pandemic. It provides examples of companies that have implemented salary reductions for employees at all levels, with higher reductions typically for higher-paid positions. Executive pay cuts ranged from 10-30% while front-line workers often saw reductions of 10% or less. Over 600 companies have announced salary reductions since the pandemic began, with the highest number of cuts occurring in April. Reductions have helped companies avoid layoffs in many cases.
2014 Compensation and Benefits Trends in the GCC ReportThe HR Observer
As the economic forecast for the region brightens up, many organisations are preparing for business growth and expansion. This has a great impact on the people operations in the business and especially on compensation and benefits to ensure employee pay and benefits are competitive to retain and engage top talent. The report summaries a GCC wide survey conducted with nearly 160 companies across many sectors. Respondents were asked to report on key pay indicators inside their companies in 2012 – 2014 to analyse major pay movements and trends. A trends analysis of various compensation and benefits instruments in the region including flexible benefits and employee wellness is then presented. The report also outlines the key strategic priorities for the profession in the next 3 years while forecasting some of the key challenges to C&B that come with growth
Ratio Anaylsis Of Nokia .. Adeel Ahmad WahlaAdeel Wahla
This document is a ratio analysis report submitted by a student for their M.Com program. It analyzes various liquidity, profitability, and leverage ratios for Nokia from 2013-2015. The liquidity ratios like current ratio and quick ratio fluctuate over the years. Gross profit margin, operating profit margin, and net profit margin all decreased in 2015 compared to previous years, indicating lower manufacturing efficiency and profits. Overall, the ratio analysis shows Nokia's financial performance weakened in 2015.
The document analyzes executive compensation trends among 50 companies that filed proxy statements between November 2014 and February 2015. It found that median CEO total compensation increased 15% from 2013 to 2014 due to higher annual and long-term incentive awards. 72% of companies had annual incentive payouts at or above target levels, and these companies demonstrated stronger financial performance. Companies continued shifting a greater portion of long-term incentives to performance-based vehicles while maintaining the use of time-based stock options and restricted stock. Say on Pay votes were majority approved for 98% of the companies analyzed.
The document discusses executive compensation practices at banks and financial institutions. It covers issues like pay freezes, incentive pay, performance metrics, restrictions on TARP recipients, calls for increased transparency and shareholder votes on compensation. It provides advice on selecting appropriate performance measures and ensuring compensation is tied to achieving goals.
A company offer a competitive compensation arrangement in order to attract, retain, and motivate a qualified CEO to manage the organization.
This Quick Guide examines the elements of executive compensation and the process by which the compensation committee establishes pay packages.
It examines the questions:
• What is the purpose of a compensation program?
• How do boards structure pay?
• What is the difference between expected, earned, and realized pay?
• How much do CEOs make?
• Are CEOs paid the “right” amount?
For an expanded discussion, see Corporate Governance Matters: A Closer Look at Organizational Choices and Their Consequences (Second Edition) by David Larcker and Brian Tayan (2015): http://www.gsb.stanford.edu/faculty-research/books/corporate-governance-matters-closer-look-organizational-choices
Buy This Book: http://www.ftpress.com/store/corporate-governance-matters-a-closer-look-at-organizational-9780134031569
For permissions to use this material, please contact: E: corpgovernance@gsb.stanford.edu
Copyright 2015 by David F. Larcker and Brian Tayan. All rights reserved.
This Data Spotlight provides data and statistics on the level and structure of CEO compensation in the United States. This data supplements in the issues introduced in the Quick Guides “CEO Compensation” and “Equity Ownership.”
This document summarizes research on the relationship between executive compensation and firm performance. The key points are:
1. Executive compensation has increased dramatically over the last 3 decades, far outpacing worker pay growth. However, research studies have found little to no correlation between high executive pay and stronger firm performance.
2. While companies argue that incentive-based pay motivates executives, some studies show executive pay is often not closely tied to performance metrics and stock price movements.
3. Alternative views of "performance" beyond short-term profits, such as investment, innovation, and workforce development, are rarely considered in executive compensation.
4. To strengthen the link between pay and performance, companies increasingly use long-
The Realities of Pay Performance for Alignment in 2014Pearl Meyer
The webinar discussed pay-for-performance alignment in board leadership. It highlighted that while pay-for-performance is ubiquitous, defining performance and ensuring the right amount of pay is given for the right level of performance remains challenging. Different stakeholders view performance differently based on measures, standards and timeframes used. The webinar also showed that long-term incentive payouts are greatest for top performing companies based on a UK CEO value index, and that just 10% of FTSE 350 companies achieved high value-added ratios. Compensation committees were advised to focus on disclosing why certain performance measures are used and ensuring incentive programs support business strategy.
The survey found that while over 60% of employees understand the factors that affect compensation, less than 55% are satisfied with their compensation, with dissatisfaction highest among employees in the technology, media, and telecommunications industry and the industrial, infrastructure, and consumer industry. Employers generally have a higher view of compensation satisfaction and understanding of compensation factors than employees. The survey also revealed gaps between employer and employee perspectives on the importance of various rewards elements.
The survey found that while over 60% of employees understand the factors that affect compensation, less than 55% are satisfied with their compensation, with dissatisfaction highest among employees in the technology, media, and telecommunications industry and the industrial, infrastructure, and consumer industry. Employers generally have a higher view of compensation satisfaction and understanding of compensation factors than employees. There are also differences in perceptions between genders, with women expressing higher satisfaction than men.
The document summarizes findings from a study of executive compensation practices in 46 companies that went public in 2011. It finds that after going public, median CEO cash compensation increased by 14% and CFO cash compensation increased by 16%. Equity dilution and annual stock burn rates increased around the IPO. Bonus targets shifted from discretionary to more formulaic. Severance and change in control protections were enhanced for executives due to increased IPO risk. Formal stock ownership guidelines were rare among these newly public companies.
The document summarizes a study on executive compensation levels and practices for companies that went public in 2011. It finds that cash compensation increased significantly for CEOs and CFOs around the time of the IPO as their responsibilities increased. Base salaries rose by a median of 14% for CEOs and 5% for CFOs. Bonus targets also increased substantially. Equity dilution and share usage increased around the IPO date due to new stock grants and employee stock purchase plans. Post-IPO, companies began shifting away from stock options to restricted stock and performance-based awards to manage dilution. Severance and change in control protections were also enhanced for executives around the time of the IPO.
Welcome to the 2021 Indigo’s C-Level Salary Guide. successful salary planning requires a thorough understanding of factors that influence the amount required to secure the appropriate talent.
The market for talent in the tech field is tighter than others, heightening the importance of proper compensation.
Financial Statement Analysis
Financial Statement Analysis
Abstract
In order to assist managers in strategic decision-making regarding certain matters of the company and meet all financial reporting requirements, a thorough internal financial analysis of the organization should be conducted, as this will determine and influence the financial well-being of the organization. A financial analysis fulfills the following purposes: it assess the growth potential of the business, it measures profitability, assess overall financial strength, and indicates the trend of achievements just to name a few. Generally, internal regulations can provide significant benefits to the organization as a whole by reducing the possibility of maladministration, improve the quality of financial information, and detect/prevent error and fraud. This paper is to therefore, suggest a key insight about the financial health of the company based on the review of the financial statement, identify the current industry trend that has the most significant impact on the organization’s financial performance, and suggest a key strategy that can be used in order to improve the financial performance of the organization while recommending an approach to implement the suggested strategy
(Baginski et al 2014)
Universal Health Services is a leading, eminent, and one of the most respected health care management companies. The organization operates through its branches of acute care hospitals and ambulatory centers, and behavioral health facilities on a national scale. Furthermore, Universal Health Services has experienced tremendous growth in its performance in the last few years as indicated in the trend analysis of the company’s performance from year 2012, specified below, and thus maintains one of the strongest balance sheets
(UHS, Inc.)
The financial analysis indicates that there is a steady increase in total revenue, gross profit and operating expenses from the year of 2012 to 2013 and from 2013 to 2014. These increases can be attributed to the increase in their level of operations from year to year. Universal Health Services has posted growing net incomes despite growing competition and legislation within the healthcare industry. The company posted an increase of $67,487 from year 2012 to year 2013. In 2014 the net income grew by $34,610 to report a total net income of $545,343.
Profitability Ratios
2012
2013
2014
Net Profit Margin
0.0637
0.07012
0.0676
Return on Assets
0.05407
0.06145
0.060766
Return on Equity
0.16343
0.15715
0.14597
An analysis of the profitability shows that the company experienced an increase in profitability from year 2012 to 2013, however in 2014 the profitability seemed to decelerate yet remained higher than 2012. The company’s total assets also increased from year to year thus substantiating to a growth-oriented organization. The increase in total assets further indicates that management has put more funds into investments contri ...
Forming an effective compensation strategy is not as easy as it appears. Some managers might use
their instinct to throw a dollar figure at an employment contract, but successful salary
planning requires a careful understanding of factors that influence the amount required to secure
appropriate talent.
The market for talent in the tech field is tighter than others, heightening the importance of proper
compensation. In addition to salary tables, this salary guide provides a high-level overview of hiring,
a look at employment in IT, and several key hiring strategies for 2019.
Over the past year, we have closed 30 top-level positions for IT companies and found that neither
candidates nor employers are confident in numbers. For instance, $ 5000 for the service station - is it a lot
or a little? Who should provide options? Is flexible scheduling motivating?
This prompted us to create a salary and compensation package survey for top managers.
167 top managers shared information about their income and other types of remuneration and motivation.
Our biggest thanks to our partner Vitaliy Luzhentsov for the competent help with statistical analysis
required for the report.
We hope the content herein will help you to make informed life and management decisions.
This document summarizes compensation trends in 2011-2012 based on a presentation by Maureen Driscoll. It discusses the following key points in 3 sentences or less:
1. Base salary increases in 2011 were higher or about the same for most organizations compared to 2010, with average increases of 2-3% projected for 2012.
2. Over half of organizations have implemented pay for performance programs to varying degrees, with median salary increases of 4% for high performers and 2% for low performers.
3. Short-term incentive plans typically target 7-12% of salary for exempt employees and 28% for executives, while long-term incentives are usually reserved for upper management to balance short- and long
CEO Pay: A Middle Market Perspective, presented to the Minneapolis-St. Paul NASPP Chapter on March 27, 2014.
Executive compensation has continued to evolve in recent years. Companies are increasingly required to balance the need for competitive pay with the need to respond to increased scrutiny, particularly with regard to the relationship between pay and performance.
To provide some insight and perspective, Buck Consultants has recently completed a study of executive compensation practices and trends in the middle market. In this study, Buck analyzed total direct compensation for Chief Executive Officers in companies listed on the S&P 400 MidCap Index.
In this presentation, we will discuss our findings with regard to both current practices and trends for CEO pay in these Mid-Cap companies. Because long-term incentives typically comprised the largest portion of executive compensation, our study focused on prevalence, mix, usage and design of equity vehicles. Finally, we will look at governance issues, including corporate governance concerns and the degree of alignment between pay and performance.
The document summarizes a presentation by Retirement Solution Group (RSG) about the state of the retirement plan industry. RSG is an independent retirement plan consulting firm that administers over 300 plans. The presentation discusses case studies of plans RSG has worked with, industry news and market updates, 401(k) trends for 2010 and beyond, and options for plan sponsors to maximize their plans while ensuring fiduciary compliance. The presentation encourages attendees to have RSG evaluate their plans to check funding levels, address any issues, and advise on strategic options.
Welcome to the 2019 Indigo’s C-Level Salary Guide. Forming an effective compensation strategy is not as easy as it appears. Some managers habitually throw a dollar figure at an employment contract. However, successful salary planning requires a thorough understanding of factors that influence the amount required to secure the appropriate talent.
The market for talent in the tech field is tighter than others, heightening the importance of proper compensation. In addition to salary tables, this salary guide provides a high-level overview of hiring, a look at employment in IT, and several key hiring strategies for 2020.
EXL Reports 2019 Third Quarter ResultsOctober 29, 2019.docxelbanglis
EXL Reports 2019 Third Quarter Results
October 29, 2019
2019 Third Quarter Revenues of $251.4 Million, up 8.8% year-over-year
Q3 Diluted EPS (GAAP) of $0.55, up from $0.43 in Q3 of 2018
Q3 Adjusted Diluted EPS (Non-GAAP) of $0.84, up from $0.71 in Q3 of 2018
NEW YORK, Oct. 29, 2019 (GLOBE NEWSWIRE) -- ExlService Holdings, Inc. (NASDAQ: EXLS), a leading operations management and analytics company,
today announced its financial results for the quarter ended September 30, 2019.
Rohit Kapoor, Vice Chairman and Chief Executive Officer, said, “EXL generated revenues of $251.4 million during the third quarter of 2019, up 8.8%
year-over-year, and adjusted diluted EPS of $0.84, up 18.3%, year-over-year.
“The strong growth in operations management this quarter is reflective of the investment EXL has made to create digital solutions and digitally-enabled
operating models to deliver business outcomes for our clients. These solutions orchestrate our deep domain expertise with data capabilities, advanced analytics
and digital technologies, enhancing our position as a strategic digital transformation partner in our markets. Our pipeline across insurance, healthcare and
analytics remains strong as we end 2019 and look forward to continued growth momentum in 2020.”
Vishal Chhibbar, Chief Financial Officer, said, “We are narrowing our revenue guidance for 2019 to $980 million - $990 million from $976 million - $996 million.
The mid-point of our guidance is at $985 million to reflect better performance in the third quarter, an annual revenue forecast of approximately $12 million for
Health Integrated offset by a foreign exchange headwind of $2 million. Our guidance now represents annual revenue growth of 12% to 13% on a constant
currency basis. Our adjusted diluted EPS guidance for 2019 is being increased to $2.95 - $3.05 from $2.86 - $2.98. Our balance sheet remains strong with cash
and short-term investments of $280.8 million as of September 30, 2019.”
Financial Highlights: Third Quarter 2019
We have six reportable segments: Insurance, Healthcare, Travel, Transportation & Logistics, Finance & Accounting, All Other (consisting of our Banking &
Financial Services, Utilities and Consulting operating segments) and Analytics. Reconciliations of adjusted (non-GAAP) financial measures to GAAP measures
are included at the end of this release.
Revenues for the quarter ended September 30, 2019 increased to $251.4 million compared to $231.1 million for the third quarter of
2018, an increase of 8.8% on a reported basis and 9.3% on a constant currency basis from the third quarter of 2018, as well as an
increase of 3.2% sequentially on a reported basis and 3.5% on a constant currency basis, from the second quarter of 2019.
Revenues Gross Margin
Three months ended Three months ended
September 30, September 30, June 30,
September
30,
September
30,
June 30,
Reportable Segments 2019 2018 2019 2019 20 ...
The document discusses relative total shareholder return (TSR) programs as a type of performance-based equity compensation plan. It provides examples of relative TSR plan designs, including those used by Intel, Bank of New York Mellon, and Gilead Sciences. Key considerations for relative TSR plan design are discussed, such as peer group selection, performance periods, payout thresholds and targets, dividend treatment, and accounting valuation using Monte Carlo simulation.
2. Equilar is the leading provider of executive compensation and corporate governance data for
corporations, nonprofits, consulting firms, institutional investors, and the media. As the trusted
data provider to 70% of the Fortune 500, Equilar helps companies accurately benchmark and track
executive and board compensation, Say on Pay results, and compensation practices.
Equilar’s award-winning Equilar Insight product suite is the gold standard for benchmarking and
tracking executive compensation, board compensation, equity grants, and award policies. With
an extensive database and more than a decade’s worth of data, the Equilar Insight platform allows
clients to accurately measure executive and board pay practices. With Equilar’s Governance
Center, companies can better prepare by analyzing historical voting results and modeling pay for
performance analyses to ensure successful Say on Pay outcomes.
Equilar Insight’s Governance Center provides a comprehensive set of tools including:
• Institutional Shareholder Services (ISS) Simulator
• Glass Lewis Modeler
• Pay for Performance Analytics Solution
Equilar’s Research Services eliminates the complexity of conducting benchmarking and
governance research, frees up internal resources for our clients, and delivers the information
needed for strategic decision making. Whether you need benchmarking data, pay for performance
analytics, employment agreement trends, or anything in between, we have the expertise to help.
About Equilar
Featured In
2015 CEO Pay Strategies | 2
3. Contents
2015 CEO Pay Strategies | 3
Introduction 4
Executive Summary / Methodology 4
Key Findings 4
Total Compensation 5
S&P 1500 Total Compensation 6
S&P 500 Total Compensation 6
S&P 1500 Total Compensation by Sector 6
Pay Components 7
S&P 1500 Median Pay Component Values by Year 8
S&P 500 Median Pay Component Values by Year 8
S&P 1500 Average Pay Mix (Cash vs. Equity) 9
S&P 1500 Average Pay Mix 10
S&P 1500 Prevalence of Cash Bonus Payouts 11
S&P 1500 Prevalence of Cash Bonus Payouts by Sector 12
Performance Equity and Equity Mix 13
S&P 1500 Equity Vehicles by Grant Prevalence 14
S&P 500 Equity Vehicles by Grant Prevalence 14
S&P 1500 Equity Vehicles by Grant Prevalence Sector Breakdown 15
S&P 1500 Equity Mix 16
S&P 500 Equity Mix 16
4. Executive Summary
The landscape of executive compensation continues to be shaped by new SEC
regulations as well as the attentions of both institutional investors and proxy
advisory firms. Despite market performance regularly breaking records in fiscal
2014, CEO compensation was still subject to the aforementioned pressures to
change. This report seeks to elucidate and encapsulate these changes to the
way America’s top executives are compensated.
Methodology
The CEOs included in this analysis include all who served in such a position at the
end of their company’s applicable fiscal year, and for the entire preceding year.
Previous versions of this report have excluded CEOs not in place for at least two
full years and included only those years in the analysis. The new methodology
has the benefit of more accurately reflecting the current makeup of America’s
CEO population and allowing comparison across any number of years. The
period chosen for most graphs and statistics is five years, encapsulating the
developments taking place since the financial crisis reshaped the American
economy and once again brought increased national attention to compensation-
related issues. The conglomerates sector was excluded from graphs displaying
sector information due to the small sample of companies. However, those
companies and their CEOs were included in all index-level statistics.
Although the graphics provided herein display a wide range of statistical
information pertaining to CEO compensation, they are only a small sampling of
available information.
Introduction
KEY FINDINGS
• Compensation of CEOs
has continued to grow.
Median compensation in
the S&P 500 was $10.3
million (up 0.9% year
over year) and median
compensation in the S&P
1500 was $5.3 million.
• Performance equity has
remained an important
part of pay.
83.2% and 82.2% of S&P
500 and S&P 1500 CEOs,
respectively, received
performance equity
awards.
• Options have given up
more ground.
The median S&P 500 CEO
saw only 15.4% of his or
her total compensation
value in the form of
options. Less than half of
S&P 1500 CEOs received
options at all.
2
3
1
2015 CEO Pay Strategies | 4
6. Total Compensation
In a booming market, companies
continued to elevate their
benchmarks as they sought better
performances from both their
executives and their own respective
businesses. As a result, CEO
compensation continued to rise across
all of the S&P 1500’s indices.
With the financial crisis no longer
at the forefront of the economy’s
collective mind, both CEOs and
corporations alike profited. Median
pay in the S&P 1500 rose since 2010,
from $4.0 million to $5.3 million.
2
4
6
8
10
6
9
12
15
2010 2011 2012 2013 2014
.
.
.
13 1 .
.
.
13 0 .
.
.
12 9
.
.
.
14 4 .
.
.
14 5
.
.
.
5 9
.
.
.
6 3 .
.
.
6 4
.
.
.
7 2 .
.
.
7 3
.
.
8 6 .8 9
.
.
10 6
.
.
11 0 .
.
10 8
.
.
11 9
.
.
12 2
.10 2
.9 2
.10 3
75th Percentile Average Median 25th Percentile
0 3 6 9 12 15
Healthcare 3.5MM 6.3MM
4.0MM 2.3MM 4.1MM
3.0MM 3.4MM 3.3MM
3.3MM 2.0MM 3.5MM
3.7MM 1.7MM 3.0MM
3.1MM 1.7MM 3.2MM
2.4MM 1.9MM 3.5MM
2.4MM 2.8MM
Basic Materials
Consumer Goods
Utilities
Industrial Goods
Services
Financial
Technology 2.6MM
75th PercentileMedian25th Percentile
3.7MM
S&P 1500 Total Compensation1
S&P 500 Total Compensation2
S&P 1500 Total Compensation by Sector3
MILLIONSMILLIONSSECTOR
MILLIONS
DATA POINTS
• From 2013 to 2014, median CEO
pay rose 7.8%, a slight change
from the 7.4% increase from 2012
to 2013 (Fig. 1)
• Median CEO pay in the S&P 500
grew only 0.9% in 2014 (Fig. 2)
• Median compensation was highest
in the healthcare sector and lowest
in the financial sector (Fig. 3)
2015 CEO Pay Strategies | 6
8. The graphs below illustrate
the degree to which CEO
compensation trends over the last five
years were driven by stock awards.
Median values of all compensation
elements in previous years were
either relatively flat or down slightly
except for stock. Performance-based
stock awards in particular saw a steep
growth prior to 2014. This year, it
appears as though this growth is
beginning to plateau. The graphs
below show the median value for each
pay type, with 2014 values labeled.
In the S&P 500, the same trends
played out at higher values, and
stock played an even larger role in
compensation packages.
Pay Components
DATA POINTS
• From 2010 to 2014, the median
value of performance-based stock
compensation in the S&P 1500
increased 38.1%, from $1,358,422
to $1,875,337, while bonuses
increased 12.4% and the median
salary value increased 2.2% (Fig. 1)
• Options were the only component
that diminished, with the median
value plummeting from its 2010
figure of $346,600 all the way to
$19,857 (Fig. 1)
• In the S&P 500, median
performance-based stock
compensation increased by 31.1%
since 2010 and 4.4% since 2013
(Fig. 2)
• Options did not decrease as
steadily as in the S&P 500, but
they still decreased by 6.0% from
2013 to 2014 (Fig. 2)
0
0.5
1.0
1.5
2.0
2.5
StockSalary Bonus Options Other
.
.
.
.
0 08
.
.
.
.
0 02
.
.
.
.
0 9
.
.
.
.
1 1
.
.
.
.
1 9
2013 20142010 2011 2012
BonusSalary Stock Options Other
0
1.0
2.0
3.0
4.0
5.0
.
.
.
.
0 2
.
.
.
.
1 1
.
.
.
.
1 4
.
.
.
.
2 1
.
.
.
.
4 5
2013 20142010 2011 2012
S&P 1500 Median Pay Component Values by Year1
S&P 500 Median Pay Component Values by Year2
MILLIONSMILLIONS
2015 CEO Pay Strategies | 8
9. Pay Components (continued)
Economic sectors varied in the
degree to which they relied on
various compensation vehicles. The
graph above breaks down CEO
compensation according to its
component sectors and indices and
by the main components of pay, cash,
and equity (as well as “other,” which
includes deferred compensation,
benefits, and perquisites). Larger
companies, as well as technology,
basic materials, and healthcare
companies, all relied particularly
heavily on equity. For the S&P
1500 as a whole, the percentage of
compensation paid in equity stood at
56.1% and cash at 40.6%. However,
average equity rose from small- to mid-
to large-cap companies, with equity at
60.5% of the average pay mix among
S&P 500 companies.
DATA POINTS
• S&P SmallCap 600 companies
had the highest percentage of
pay attributable to cash at 49.5%,
higher than any individual sector
(Fig. 3).
• The basic materials and healthcare
sectors each had relatively high
equity at 58.0% and 60.9% of the
average pay mix, respectively.
The only sector to have a higher
percentage of pay in cash than
equity was the financial sector,
which had a mix of 49.7% cash
and 45.6% equity (Fig. 3)
0 20 40 60 80 100
36% 4%
3%
4%
3%
3%
3%
4%
4%
4%
3%
3%
3%
60%
55%
45%
53%
58%
49%
46%
61%
52%
52%
58%
54%
42%
51%
44%
39%
47%
50%
35%
44%
45%
39%
43%
OtherEquityCash
S&P 500
S&P 400
S&P 600
S&P 1500
Basic Materials
Consumer Goods
Financial
Healthcare
Industrial Goods
Services
Technology
Utilities
S&P 1500 Average Pay Mix (Cash vs. Equity)3
2015 CEO Pay Strategies | 9
10. Pay Components (continued)
DATA POINTS
• Bonuses had the highest average
percentage of total compensation
within the financial and industrial
goods sectors, at 28.1% and
25.6%, respectively (Fig. 4)
• Options were particularly important
within the healthcare sector at
23.9%, compared to 12.9% on
average in the S&P 1500 (Fig. 4)
• The highest salaries as a
percentage of total compensation
were in the S&P SmallCap
600, while salaries made up
a much lower percentage of
total compensation at S&P 500
companies (Fig. 4)
4%
S&P 500
S&P 400
S&P 600
S&P 1500
Basic Materials
Consumer Goods
Financial
Healthcare
Industrial Goods
Services
Technology
Utilities
Basic Materials
Consumer Goods
Financial
Healthcare
Industrial Goods
Services
Technology
Utilities
0 20 40 60 80 100
13% 23% 43% 17% 3%
12% 3%
10% 4%
13% 3%
14% 3%
17% 3%
9% 3%
27% 5%
22% 3%
23% 4%
16% 3%
4% 3%
11% 3%
14% 3%
5% 5%
24% 4%
16% 4%
16% 3%
15% 3%
3% 3%
18% 24% 42%
28% 23% 35%
20% 23% 40%
13% 19% 50%
12% 25% 43%
12% 30% 46%
11% 19% 39%
12% 25% 39%
14% 24% 35%
12% 20% 49%
14% 24% 56%
17% 22% 47%
24% 24% 35%
22% 28% 41%
17% 18% 37%
18% 26% 36%
22% 23% 36%
20% 19% 43%
14% 24% 51%
Options OtherSalary Bonus Stock
S&P 1500 Average Pay Mix4
S&P1500SECTORSS&P500SECTORSINDICES
2015 CEO Pay Strategies | 10
11. Pay Components (continued)
As pay for performance has come under public scrutiny, discretionary
bonuses have been phased out in favor of more short-term, incentive-based
compensation. In 2010, 77.2% of S&P 1500 CEOs received short-term
incentive plan bonuses, compared to 83.5% in 2014.
DATA POINTS
• The prevalence of discretionary
bonus payouts declined
significantly among S&P 1500
companies, decreasing from 23.6%
to 14.5% (Fig. 5)
• Conversely, the prevalence of
short-term cash incentive payouts
continued to increase across
the board, growing from 77.2%
to 83.5% prevalence from 2010
to 2014 in the S&P 1500, and
long-term cash incentive payouts
remained relatively stable (Fig. 5)
20102010 2011 2012 2013 2014
10%
20%
80%
100%
.
.
77%
.
.
77%
.
.
78%
.
9%
.
8%
.
9%
.
7%
.
.
82% .
.
84%
24%
.
.
.
19%
.
.
.
19%
.
.
.
15%
.
.
.
14%
.
.
.
8%
STI LTIDiscretionary
S&P 1500 Prevalence of Cash Bonus Payouts5
2015 CEO Pay Strategies | 11
12. While overall trends of increasing
STI payouts, stable LTI payouts, and
decreasing discretionary bonuses were
consistent across the last five years,
the breakdowns varied significantly by
sector.
DATA POINTS
• Discretionary bonuses were most
common in the financial sector,
present at 22.8% of companies,
compared to 14.5% in the overall
S&P 1500 (Fig. 6)
• The utilities sector had the
highest prevalence of STI
payouts, at 100.0% of companies,
compared to 83.5% in the overall
S&P 1500 (Fig. 6)
Pay Components (continued)
0 20 40 60 80 100
S&P 500
S&P 400
S&P 600
S&P 1500
Basic Materials
Consumer Goods
Financial
Healthcare
Industrial Goods
Services
Technology
Utilities
88%
12%
11%
88%
13%
8%
84%
14%
8%
77%
18%
6%
87%
15%
9%
23%
10%
13%
13%
13%
15%
84%
77%
85%
88%
83%
82%
2%
98%
10%
12%
4%
8%
19%
8%
5%
STI DiscretionaryLTI
S&P 1500 Prevalence of Cash Bonus Payouts by Sector6
S&P1500SECTORSINDICES
2015 CEO Pay Strategies | 12
14. DATA POINTS
• Performance awards were a more
popular vehicle for S&P 1500 CEO
awards than either time-based
options or time-based stock (Fig. 1)
• Although on the decline, time-
based options were still more
prevalent than time-based stock in
the S&P 500 (Fig. 2)
The type of equity that large
American companies use to
incentivize their executives changed
over the period studied. The years
since 2010 saw performance-based
equity take center stage, with the
share of S&P 1500 CEOs receiving
it rising from 45.9% to 82.2%.
Performance-based equity was
even more popular within the S&P
500, received by 83.2% of CEOs.
Options, meanwhile, declined from a
prevalence of 55.0% among S&P 1500
companies in 2010 to 47.1% in 2014.
Larger companies were more likely to
grant each type of equity, and they
generally relied on a greater diversity
of equity vehicles.
2010 2011 2012 2013 2014
40
60
80
100
82%
60%
47%
63%
55%
48%56%
54%
49%
55%
55%
51%
55%
54%
46%
Time-Based Options Performance AwardsTime-Based Stock
2010 2011 2012 2013 2014
40
60
80
100
40
0
08
001
40
60
80
100
67%
58%
51%
70%
63%
50%
70%
60%
48%
76%
60%
50%
83%
58%
53%
Time-Based Options Performance AwardsTime-Based Stock
S&P 1500 Equity Vehicles by Grant Prevalence1
S&P 500 Equity Vehicles by Grant Prevalence2
MILLIONSMILLIONS
Performance Equity and Equity Mix
2015 CEO Pay Strategies | 14
15. While performance-based awards were
more prevalent than time-based stock
or options, this was most pronounced
among the largest companies. In both
the S&P MidCap 400 and the S&P
SmallCap 600, the gap between the
prevalence of performance-award
and time-based-stock was slightly
narrower. Performance awards were
also the most common equity vehicle
within each individual sector.
DATA POINTS
• The healthcare sector had the
highest prevalence of performance-
based equity awards at 92.2%, while
the lowest prevalence was in the
utilities sector, with a prevalence of
65.5% (Fig. 3)
• The utilities sector had the lowest
prevalence by far of time-based
options at just 16.4%, compared
to 47.1% in the S&P 1500 as a
whole (Fig. 3)
0 20 40 60 80 100
S&P 500
S&P 400
S&P 600
S&P 1500
Basic Materials
Consumer Goods
Financial
Healthcare
Industrial Goods
Services
Technology
Utilities
53%
83%
58%
59%
80%
44%
60%
82%
47%
66%
83%
40%
72%
88%
82%
75%
92%
86%
81%
86%
50%
61%
63%
54%
65%
16%
58%
52%
53%
28%
75%
58%
54%
43%
65%
Time-Based Options Performance AwardsTime-Based Stock
58%
S&P 1500 Equity Vehicles by Grant Prevalence Sector Breakdown3
Performance Equity and Equity Mix (continued)
S&P1500SECTORSINDICES
2015 CEO Pay Strategies | 15
16. The following two charts show the mix
of equity vehicles (time-based options,
time-based stock, and performance-
based equity) awarded to CEOs
from 2010 to 2014. The two indices
were similar in the sense that overall
the use of any single equity vehicle
declined, while combinations of equity
increased significantly. In the S&P
1500, a combination of restricted stock
and performance stock was the most
common, whereas the most prevalent
grant practices in the S&P 500
consisted of options and performance
shares or options, restricted shares,
and performance shares.
Performance Equity and Equity Mix (continued)
DATA POINTS
• Equity mixes that included
performance-based awards had the
highest prevalence in 2014. All such
mixes were up sharply in prevalence
over the five-year period, except for
the use of performance shares by
themselves (Fig. 4, 5)
• The number of companies that did
not grant any equity dropped to
7.7% (Fig. 4, 5)
• While in the S&P 1500, the most
common equity vehicle mix was
a combination of restricted stock
and performance stock, the most
common mix in the S&P 500 was
a combination of options and
restricted stock (Fig. 4, 5)
0
5
10
15
20
25
No Equity O Only RS Only PS Only O & RS O & PS RS & PS O & RS & PS
23%
.
.
.
17%
.
.
.14%
.
.
.11%
.
.
.
14%
.
.
.
9%
.
.
.
5%
.
.
.
8%
.
.
.
2013 20142010 2011 2012
No Equity O Only RS Only PS Only O & RS O & PS RS & PS O & RS & PS
0
5
10
15
20
25
6%
.
.
.
4%
.
.
.
15%
.
.
.
9%
.
.
.
22%
.
.
.
18%
.
.
.
21%
.
.
.
4%
.
.
.
2013 20142010 2011 2012
S&P 1500 Grant Equity Mix4
S&P 500 Equity Grant Mix5
MILLIONSMILLIONS
2015 CEO Pay Strategies | 16