The SEC’s New Pay Versus Performance Rule: 2024 Guidance for Companies and Investors.
The SEC’s New Pay Versus Performance Rule, enacted to enhance transparency and accountability in executive compensation practices, requires companies to report “mark-to-market” pay – called “Compensation Actually Paid (CAP)”. This new disclosure gives investors the ability to measure key dimensions of executive pay – incentive strength, alignment, performance-adjusted cost, and relative pay risk – without performing elaborate and time-consuming analysis to estimate mark-to-market pay from the pay and grant data reported in the proxy statement.
Join us in this webcast as Stephen O’Byrne of Shareholder Value Advisors Inc. explains the new rule, shows how to use the reported data to calculate these key dimensions of executive pay, reports his findings on pay alignment and performance-adjusted cost for 900 public company CEOs, and shows how the calculated pay dimensions can be used to guide better incentive plan design.
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President at Shareholder Value Advisors Inc.
Stephen F. O’Byrne is President and co-founder of Shareholder Value Advisors Inc., a consulting firm that helps companies increase shareholder value through better performance measurement, incentive compensation and valuation analysis. His work on measuring the strength and cost-efficiency of top management incentives has been published in the Harvard Business Review, the Journal of Investing, Conference Board Director Notes, the Journal of Applied Corporate Finance and the WorldatWork Journal. He is the co-author, with Professor David Young of INSEAD, of EVA and Value-Based Management. He was previously head of the compensation consulting practice at Stern Stewart & Co. and a Principal in the executive compensation practice at Towers Perrin.
