Despite the overwhelming endorsement of executive pay by shareholders, some companies have struggled with these qualitative reviews. Pay Governance’s new study is based on research into how companies fared on ISS’ qualitative executive pay program review after failing an initial quantitative pay-for-performance testing. The research database includes all S&P 1500 companies that failed the initial quantitative test.
The Qualitative Factors Score provides a methodology to assess how a company’s pay programs and practices may be viewed by ISS. Additionally, Pay Governance is able to use its proprietary database of Qualitative Factors Scores to estimate the relative risk of receiving an “AGAINST” recommendation from ISS on the advisory say-on-pay vote.
“The key challenge is to motivate executives to create shareholder value in an ISS and say-on-pay world. We have found a unique way to help our clients do this by effectively navigating ISS’ complex and subjective qualitative review,” said
The Qualitative Factors Score is not intended to predict ISS’ recommendations for the advisory say-on-pay vote. Rather, the scoring process provides insight into which specific pay practices will be viewed most favorably and which may be viewed as “concerns” by ISS.
Pay Governance partner
Additional information on the research underlying the Qualitative Factors Score is available on the firm’s website at www.paygovernance.com.
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