A new chapter begins
2024 updates to ISS’s compensation voting policies and equity plan scorecard
Proxy advisor Institutional Shareholder Services (ISS) has updated its compensation policy FAQs, pay-for-performance mechanics white paper and Equity Plan Scorecard (EPSC) for the 2024 proxy season. There are no changes to the three primary quantitative pay-for-performance screens for 2024, but slight changes were made to the secondary screen. Other compensation updates address how to respond to an adverse say-on-pay (SOP) recommendation, adjustments to incentive plan results (including the use of non-GAAP metrics) and distinguishing problematic change-in-control (CIC) severance payments (e.g., single trigger or modified single trigger) from “bona fide” transaction awards. The EPSC updates move some of the weight ISS places on the plan cost and grant practices pillars to the plan features pillar and make normal annual adjustments to the burn rate benchmarks. The updates are effective for meetings held on or after February 1, 2024.
Separately, ISS added compensation factors on non-CEO executive severance and CIC agreements to its Governance QualityScore, and Glass Lewis updated its voting policies. (See Glass Lewis’s 2024 voting policy updates address clawbacks and stock ownership guidelines; ISS issues QualityScore updates.) ISS has not yet updated its non-compensation policies and procedures FAQs.
is a Senior Principal in Mercer's Law & Regulatory Group (L&R), which is a team of lawyers who track and analyze legislative, regulatory, judicial and other technical issues related to executive compensation and corporate governance. L&R provides expert analyses on a variety of US and Canadian compliance and policy matters, and develops leading-edge intellectual capital for Mercer consultants and clients. Amy provides advice to consultants and clients on securities and corporate governance issues affecting executive pay in North America. Amy advises clients on legal compliance and risk mitigation issues related to executive compensation and corporate governance. She serves clients in industries such as financial services, natural resources and energy, consumer goods and retailing, food and beverage, manufacturing, and utilities. She is a leading Mercer expert in securities law compliance and corporate governance.
is a Partner and Senior Legal Consultant in Mercer's Law & Regulatory Group (L&R) based in New York. She specializes in technical legal and regulatory issues affecting executive compensation and corporate governance. She focuses on SEC disclosure, tax, employment and change in control agreements, equity programs, and employee benefit issues that arise in the context of corporate transactions and initial public offerings.
is a Parter and the Head of Mercer’s US & Canada Executive Rewards Practice. He advises US and Canadian companies’ Compensation Committees and senior leadership teams on a wide variety of executive compensation topics and Board of Director pay issues. In addition, he leads the go-to-market strategies, as well as the development of intellectual capital and technical solutions, for Mercer’s Executive Rewards Practice in the US and Canada.