On August 25, the SEC released the final rule on the long-awaited pay versus performance (PvP) disclosure required under Section 953(a) of Dodd-Frank. The rule adds Item 402(v) to Regulation S-K, which companies are required to comply with in proxy and information statements for fiscal years ending on or after December 16, 2022.
The PvP disclosure is an amalgamation of realizable and realized pay, and the required disclosure will easily rank as the most complex one in the proxy. It stands in contrast to the Summary Compensation Table (SCT) framework, which depicts the deal struck at grant without any mechanism for showing how performance-based features operate to index pay to performance.
Get on top of the new rule with our collection of insights. Need help with adoption, compliance, and strategy? Check out our PvP valuation and advisory services, or just contact us directly.
Critical SEC Updates for Pay vs. Performance Year Two
As companies gear up for year two of PvP disclosures, join us for a critical PvP review on the SEC’s C&DIs, comment letters, best practices, and more.
How the SEC’s Latest C&DIs Impact Pay vs. Performance Disclosure Practices
On September 27, the SEC issued a second batch of Compliance & Disclosure Interpretations on pay vs. performance. We summarize each interpretation provided by the SEC and share our reactions.
The First Batch of SEC Comment Letters on Pay vs. Performance Has Dropped. Here’s What We Learned.
The SEC uploaded its first batch of comment letters on PvP disclosures. In this blog, we look at 17 comment letters dated between July 27 and August 22 and summarize the top themes.
Lessons Learned From Pay vs. Performance Disclosures
The dust has settled on proxy filings for calendar year companies, and a critical mass of pay vs. performance disclosures have now hit the market. Join Takis Makridis, David Outlaw, and Siddharth Thaker for this deep dive into what you need to know about PvP moving forward.
Insights from Company Pay vs. Performance Disclosures
Takis Makridis · 3/5/2023
We are collecting Pay vs. Performance disclosures as they are filed. Here we summarize trends and insights from the initial group of filers. This article will be periodically updated as more data is released and collected.
A Primer on the SEC’s New C&DIs for Pay vs. Performance
Get our summary of—and reaction to—each interpretation provided by the SEC’s C&DIs for the pay vs. performance proxy disclosure.
In Life and PvP Disclosure, Relationship Clarity is Key
Takis Makridis · 2/2/2023
As companies get their PvP tables ready, the next step is deciding on how to “clearly describe” the PvP relationships. During this webcast playback, we look at strategies for addressing this important component of the disclosure.
Disclosing PvP Relationships, Part 3: Decision Criteria
Takis Makridis · 1/19/2023
In the final installment of our series, we lay out key considerations in determining a disclosure strategy for pay vs. performance relationships.
Disclosing PvP Relationships, Part 2: Disclosure Archetypes
Takis Makridis · 1/5/2023
In Part 2 of our series, we walk through six archetypes for disclosing pay vs. performance relationships under the SEC’s rule.
Disclosing PvP Relationships, Part 1: Types of Relationships
Takis Makridis · 12/21/2022
In the first of a three-part series, we review how to analyze pay vs. performance relationships and introduce some of the relationship types we’ve seen.
Item 402(v) Pay vs. Performance Disclosure Readiness Checklist
Takis Makridis · 11/19/2022
Use this checklist to help you prepare for disclosure under the SEC’s new pay vs. performance rule.
Pay Versus Performance Is Here, Part 3: Valuing Stock Options for Compensation Actually Paid
One aspect of the new pay versus performance rule is valuing outstanding employee stock options to calculate CAP. But which model should you use, and how should you estimate the inputs? Walk through the options in this article.
Pay vs. Performance: Your Questions, Our Perspectives
This webcast is a panel discussion on the SEC’s new pay vs. performance rule. Tune in for answers to the most frequently asked questions we’ve received on how to implement and comply with the rule’s design.
Inside the SEC’s New Pay vs. Performance Rule
On August 25, the SEC finalized its highly anticipated pay vs. performance rule. In this webcast, we’ll review the final rule, look at various scenarios, and go over some of the questions we’re receiving from our clients.
Pay Versus Performance Is Here, Part 2: Understanding Compensation Actually Paid
Now that the SEC released the final pay versus performance rule, let’s look at the logic and mathematics behind the core disclosure table.
Pay Versus Performance Is Here, Part 1: Overview and Action Items
Takis Makridis · 8/29/2022
Get our initial take on the SEC’s long-awaited pay versus performance disclosure rule, an overview of its key elements, and an action plan to execute now.
What You Need to Know About the SEC’s (Re-) Proposed Pay vs. Performance Rule
David Outlaw · 2/08/2022
In January 2022, the SEC reopened the comment period on the proposed “pay vs. performance” rule. What’s in the rule, and what can you do to prepare?
Financial Performance Assessment: The New ISS Pay-for-Performance Test
As predicted, ISS is broadening their quantitative test to include relative financial metrics. As much as TSR has come under fire as a metric, other metrics can often raise even more issues to manage.
Understanding the Impact of the SEC Pay vs. Performance Disclosure Rules
Takis Makridis · 6/8/2016
Presented at the 2016 World at Work Total Rewards Conference in San Diego, CA, this session reviews the current status of the proposed rules and provides guidance on what compensation professionals can be doing now to get ahead of these changes.
The SEC’s Proposed Pay-Versus-Performance Disclosure Rule Explored
David Outlaw · 12/11/2015
Join Equity Methods’ David Outlaw and a panel of key thought leaders in this live webcast hosted by The Knowledge Group.
SEC Pay vs. Performance Disclosure – Initial Perspectives on the Proposed Rules
David Outlaw · 5/29/2015
SEC has released its long-awaited proposed guidance on pay-for-performance disclosures. Get Equity Methods’ take in this 30-minute, on-demand webinar.
What You Need to Know About the SEC Pay-for-Performance Proposal
David Outlaw and Fan Wang · 5/14/2015
The SEC’s proposed rules aim to create a standard measure that lets shareholders compare performance across companies. But what’s in a standard measure?