Support the case for your compensation with clear and thoughtful analytics.
You’ve found every domestic and international employee in the company. You’ve determined a CACM and gathered pay data from all of your payroll systems. You’ve adjusted for exchange rates and annualized mid-year hires. You’ve identified your median employee (somewhere in the Midwest). And now you finally know your CEO pay ratio.
At this point, it feels like you must be done, but you are not there yet.
Helping dozens of companies prepare their pay ratio analysis has taught us that collecting data and calculating a ratio is only the beginning. Stopping there can leave you woefully unprepared for questions from executives, the board, employees, and investors. And if you use all of the collected data for compliance only, you’ll miss useful insights such as comparisons by department, geography, or even gender.
How We Help
We develop analytics to help you communicate more effectively with your pay ratio stakeholders, including:
- Preparers. The team responsible for actually performing the analysis wants to make sure the result is accurate, stable, and sensible.
- Management. Your leadership team wants to stress-test your results with questions about assumptions and sensitivity. And if data like this has never been compiled before, they can use it to strategically analyze the organization’s pay structures and practices.
- Human resources. After disclosure, and even before disclosure for late filers, employees are likely to ask questions about the pay distribution, why certain employees are below the median, or why your competitors’ employees might appear to earn more. HR needs the right tools to answer these questions and explain the results internally.
- Board of directors. Your board or compensation committee will be interested in the result and have tough questions of their own. And the most effective way to communicate with most boards is via sharp visualizations and concise analyses.
- Investors. Certain investors may be particularly interested in sustainable pay and fair global practices. Targeted and detailed analytics can help you tell a clear story.
Even if your company handles pay ratio analysis internally, you can benefit from:
- Supplemental analysis. Derive insights from your data and create powerful visualizations to tell your story.
Sensitivity testing. Understand how methodology, data, or pay changes can affect your results.
- Internal messaging. Create slides for board meetings or FAQs for employee communications.
Feedback. Throughout the process, have an experienced team at your side to provide feedback on industry practices and the rule itself.
- Feedback. Throughout the process, have an experienced team at your side to provide feedback on industry practices and the rule itself.
Pay Ratio Analytics: Granular Pay Breakdown Example
Summarize pay by jurisdiction or business unit to understand how each group affects the pay ratio and analysis—as well as how they compare to one another.
Pay Ratio Analytics: Overall Pay Distribution Example
Summarize your entire dataset to understand the clustering and distribution of your pay. Gain easy insights to how changes in pay or approach can affect your pay ratio.
Pay Ratio Library
Here’s a resource center for HR, finance, and accounting professionals who want to get on top of Dodd-Frank CEO pay ratio disclosure rules.