Look at the year ahead and beyond
LEADERSHIP & STRATEGY
company stocks . “ Companies will need to consider measures to create value for executives , and to realign their interests with those of shareholders generally ,” comments Alvarez & Marsal , which identifies three approaches going forward :
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• Resetting awards based on the lower current stock value
• Issue new awards based on current share prices
• Issue additional awards to maintain a view that the intended longterm incentive (“ LTI ”) value will be achieved
However , Alvarez & Marsal does note that whether a company decides to reset existing awards or issue
Factors to consider when modifying performance criteria
• SEC disclosure requirements
• The accounting impact
• How the change in performance metrics will be perceived by the public , employees and investors
Alvarez & Marsal additional awards , each approach comes with its own potential challenges that shouldn ’ t be overlooked .
Look at the year ahead and beyond
While the end of 2020 brought about approved vaccines and rapid distribution at scale , it has also brought new variants and increasing cases . As a result , expectations for the year ahead for executive compensation – like many
FEBRUARY 2021