The Effect of Proxy Issues on Executive Compensation Webinar: A Review of the Recent Proxy Season and What You Should Be Considering Now

Morgan Lewis's Benjamin Delancy, Linda Griggs, and Gary Rothstein, with guest speaker Reid Pearson of the Altman Group, presented this webinar on proxy issues and their effect on compensation planning. The discussion included a review of RiskMetrics Group (RMG)/Institutional Shareholder Services (ISS) policies on compensation (with a primary focus on equity compensation plan issues) and current trends and issues to consider as 2009 wraps up.

Topics for discussion included:

Review of RMG/ISS policies

• Shareholder Value Transfer (SVT) Test
• Pay-for-Performance (PFP) Test
• Burn rate
• "Bad" practices, such as tax gross-ups and single-trigger change-in-control provisions

Major issues and trends

• Shrinking SVT headroom and the effect of underwater options
• PFP test: How many companies actually failed and how to deal with falling into a problem category
• Burn rate
• Bad practices
• Repricings: NEO participation and value-for-value features
• Shareholder proposals: Say on pay/golden parachutes
• Securities law considerations

Current issues that companies should be considering