The M&A Lynchpin: Success or Failure Starts with HR

February 27, 2015

Written by: Brent Longnecker, Kevin Kuschel, & Jordan Welch   The market for merger and acquisition ("M&A") activity increased sharply in 2014, largely as a result of the abundance of available cash and zero interest rate policies.  According to a recent Proxy Mosaic analysis, the US market announced 9,814 deals amounting to over $1.5 trillion in value.  Even more surprising is projections point to an uptick in M&A activity in 2015.  So, while the desire for M&A is obvious, why is it that more often than not deals end up being considered a failure?   A significant amount of time and effort is put into the front side of every deal, including research, meetings, due diligence, and did we mention…

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A First Look at ISS’ Equity Plan Scorecard

February 18, 2015

As announced in their draft rules published in December, ISS is adopting an Equity Plan Scorecard Model (EPSC) that is intended to consider a range of positive and negative factors rather than their traditional "pass" or "fail" tests. They are hoping to use this new model to evaluate long-term equity incentive plan proposals. The final EPSC score will help in determining whether they will recommend "for" or "against". The updated guidelines went into affect for all public companies with annual meetings on or after February 1st of this year.   To read more on this article, click here.    share

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Hear Ye, Hear Ye: Is ISS Starting to Listen? Yes and No…

February 3, 2015

Last month ISS "inflated" a new game ball with a new policy update for peer group selection in the energy industry. They have decided to move from peer selection on revenue to that of market cap. We discuss at length the issue and wonder if this will be coming for other industries as well.  Read the full article written by L&A here: Hear Ye, Hear Ye: Is ISS Starting to Listen? Yes and No…. share

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Choosing a Strategic Compensation Consultant

December 30, 2014

Choosing the right consulting firm is more important than ever before.  How do you know which type of consulting firm is best suited to meet your needs? This article breaks down the different types of consulting firms and how each accommodates to a particular type of service.  Learn what questions you should be asking and how this process should look to find the best consultant for you. To read more on this article, click here. share

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ISS and Glass Lewis Continue to Clinch the Purse Strings

December 11, 2014

There is one looming question for public company management teams and board of directors which always creeps into discussions related to compensation planning: How much will ISS and Glass Lewis move the target for their pay-for-performance and governance models in the coming year?  Both companies recently released their changes for the 2015 guidelines with minor revisions to their pay – for – performance models.  This is the first year in which neither company made major revisions to their models but rather focused more on over-arching governance issues.  L&A has outlined the major governance and compensation-related changes below but recommends clients review all the new guidelines directly from ISS and Glass Lewis.   To read more on this article, click here. share

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SEC Guidance May Lessen Investment Adviser Demand for Proxy Advisory Services

November 11, 2014

  Pulled from Harvard Law School's Forum on Corporate Governance and Financial Regulation, this article discusses recent SEC guidance related to investment adviser demand for proxy advisory services.  We have noticed an increased concern amongst our public company clients about the growing influence and perceived power of proxy advisors, as well as the methodology behind their ever-changing policies and procedures. The article addresses the corporate community's actions as it works to highlight this growing influence, as well as the SEC's corresponding response through recently published guidance relating to both proxy firms and their investor clients.     To read more on this, click here.      As always, please let us know if there are any topics you'd like to…

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A Lesson in Dealing with Shareholder Advisory Firms

November 4, 2014

Now headed into the fourth year of Dodd Frank and Say-On-Pay, many companies have had the unfortunate experience of crossing paths with ISS and their seemingly unexplainable influence on otherwise logical shareholders.  We have helped many clients successfully navigate through negative ISS recommendations and develop plans to reduce the risk of future run ins.  Our experience, and the experiences of other we have talk with have been invaluable, and where there is no perfect formula, understanding the keys to others successes can only be beneficial. To read more on this article, click here. share

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Question: Oil company directors & officers own 3% of US oil & gas company shares. Is that too low?

October 23, 2014

We were asked on Twitter the following question: "Oil Company directors and officers own 3% of U.S oil, gas company shares.  Is that too low?" http://fuelfix.com/blog/2014/10/21/report-retirees-401ks-hold-most-shares-in-oil-gas-industry/ Our Resonse: The amount executives and directors own as a percent of a company is tied to the size of the company.  The larger the company, the smaller the percentage. 3% ownership for executives and directors only is in the ballpark for large market cap companies. Small to mid cap companies have larger ownership levels.    share

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Executive Pay: The Sin Tax of the Future

October 22, 2014

Executive pay is about to become the new sin tax. Executive Pay continues to be one of the most heated discussions in America.  In addition, the US Government is in serious debt ($16.5 trillion) and running a deficit each year ($500 billion); the gap between the average worker and CEO has jumped from 46x in 1983 to 331x currently (AFL-CIO analysis of S&P 500 companies); a law was recently passed in Obamacare to tax executive pay for insurance companies over $500,000; the media is constantly running stories on the pay gap problem; all of which will create the perfect storm to redistribute corporate and shareholder dollars to the US Government. There is currently legislation on both sides of Congress led by…

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Sustainability Bonuses: A New Trend That May Become the Norm

August 14, 2014

A New Trend that May Become the Norm We have seen a recent uptick in companies, especially Fortune 500, integrating metrics that are more about the company sustainability and/or social responsibility.  While these metrics are not the majority of the weight for determining payouts, they may be a gatekeeper that prohibits payouts. Companies are using metrics like reduced carbon footprint, energy consumption, use of renewable resources, commute time, environmental impact, etc.  Hugh Welsh of The Guardian recently wrote about having sustainability goals and not achieving them.  The article can be read here. We believe this recent trend among Fortune 500 may become more the norm over the coming year. Why? The increased use in these corporate sustainability metrics has various shades…

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