Latest Insights
We provide timely, expert analysis on emerging trends and developments in executive compensation, guiding organizations in making informed, forward-thinking decisions.
Scrutiny and Standardization of Director Pay
Article | The Corporate Board with FW Cook Thought Leadership by Alec Lentz, Kenneth Sparling
With more attention on board pay, programs are becoming more standardized and equity pay is usually in stock awards targeted at specific dollar values. Lawsuits are causing director-specific pay limits to become an emerging best practice.
FASB Issues Accounting Standards Update on Employee Share-Based Payment Accounting Improvements
Alert | By Thomas Haines
On March 30, FASB issued Accounting Standards Update 2016-09, which finalizes amendments intended to improve and simplify accounting for stock compensation under FASB Accounting Standards Codification Topic 718. The issuance of ASU 2016-09 concludes this narrow-scope fast-track project…
Accounting for Stock Compensation Under FASB ASC Topic 718
Alert | By Thomas Haines
FASB Accounting Standards Codification Topic 718, Stock Compensation, requires generally that all equity awards granted to employees be accounted for at “fair value.” This fair value is measured at grant for stock-settled awards, and at subsequent exercise or settlement for cash-settled awards.
U.S. Executive Compensation – 2015 Recap, Key Developments & Notable Trends
Alert | By Bindu Culas, Metin Aksoy
For public companies, boards of directors, and practitioners, 2015 was an eventful year in executive compensation. FW Cook presents the key developments and trends we observed during 2015 and their implications for 2016 and beyond.
Recent Facebook Settlement Over Director Pay Could Signal More Litigation Against Directors
Alert | By David Gordon, Bindu Culas
Executive compensation experts were unpleasantly surprised by the settlement in late January of Espinoza v. Zuckerberg, a case challenging the reasonableness of stock awards to Facebook’s non-employee directors. The facts surrounding this settlement create concern that unless a company has a shareholder-approved plan…
FASB Directs Staff to Draft a Final Accounting Standards Updateon Employee Share-Based Payment Accounting Improvements
Alert | By Thomas Haines
On November 23, FASB directed its staff to draft a final Accounting Standards Update for vote by written ballot on its narrow-scope fast-track project to improve and simplify accounting for stock compensation under FASB Accounting Standards Codification Topic 718…
Proxy Advisory Firms Release 2016 Policy Updates
Alert | By Edward Graskamp, Samantha Nussbaum
ISS and Glass Lewis recently released their 2016 policy updates, which will apply to 2016 annual meetings held on or after January 1 for Glass Lewis and February 1 for ISS. The compensation-related policy changes for the U.S. and Canada are, for the most part, relatively minor or apply to only a limited number of companies. One major change is ISS’ Canadian roll-out of its equity plan scorecard…
The Pay Ratio Rule – Preparing for Compliance
Article | By Bindu Culas, Michael Marino
The SEC’s recently adopted pay ratio rule is complex and offers companies flexibility in determining their pay ratios. Companies should start the compliance process in the near term to evaluate the options the pay ratio rule provides and address any issues that arise in applying those options.
ISS Releases 2016 Draft Policy Changes For Comment
Alert | By Wendy Hilburn
On October 26, ISS released drafts of 2016 policy changes for public comment, which will apply to annual meetings held on or after February 1, 2016. The draft U.S. policy changes do not address updates to ISS’ key compensation policies pertaining to pay-for-performance evaluations, including…
FASB Concept of Extraordinary Items to Disappear Beginning with 2016 Calendar Year Financial Statements
Alert | By Thomas Haines
Beginning with 2016 financial statements, the concept “extraordinary items” as a technical accounting term will no longer exist. This will be important when drafting beginning-of-year resolutions establishing performance measures and goals for incentive plans.
SEC Finalizes CEO Pay Ratio Disclosure Rule
Alert | By Michael Marino, Samantha Nussbaum, Cimi Silverberg
Two years since issuing the proposed rule, after considering more than 285,000 comment letters, and in a contentious three to two vote, the SEC approved the final rule implementing the CEO pay ratio disclosure mandated by the Dodd-Frank Act.
SEC Proposes Compensation Clawback Rules – Recovering Compensation Paid to Executive Officers in the Case of Restatements of Financial Statements
Alert | By David Gordon, Bindu Culas
On July 1, nearly five years after the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the “Act”) was enacted, the Securities Exchange Commission (“SEC”), in a split vote of three to two, proposed rules to implement Section 954 of the Act. Section 954 requires companies to adopt and enforce…
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