The Hybrid Award: Bringing Efficiency to LTIPs?

Presented by: Takis Makridis

Presented at: WorldatWork 2017 Total Rewards Conference & Exhibition, Washington, D.C., May 7-10, 2017

Panelists: Takis Makridis, Equity Methods – Mark Breer, Microsoft Corporation – Stephen Charlebois, Semler Brossy Consulting Group, LLC

Critiques of relative total shareholder return (rTSR) have fueled the emergence of a new design called the hybrid award. Hybrid awards come in different shapes and sizes, but fundamentally represent a combination rTSR and one or more operational or financial metrics. Hybrid awards tackle line-of-sight problems with pure rTSR designs while still delivering robust pay-for-performance linkage. The panel explored the key design considerations of hybrid awards, their benefits and drawbacks, and essential execution tips for rolling out hybrid award designs.

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