Innovations in Proxy Design: The Compensation Discussion & Analysis

Featuring commentary from

Innovations in Proxy Design: The Compensation Discussion & Analysis, an Equilar publication, delves into the proxy statements and accompanying CD&As of the Equilar 100—the top 100 U.S.-listed companies by revenue—over the last five years. The report reflects a manual analysis of these 100 companies to review the recent evolution in compensation-related disclosure practices and provides a look ahead to what may come in 2018. Donnelley Financial Solutions offered independent commentary to provide context and color on companies’ approach to compensation issues and communications with shareholders through proxy statements and other channels.

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Key Findings:

  • The Compensation Discussion and Analysis (CD&A) section of Equilar 100 companies’ proxy statements has annually increased in length, topping out in 2017 with an average word count of 9,490 words.
  • As an effort to help investors navigate proxy statements that grow longer each year, the percentage of Equilar 100 companies that included a proxy summary increased from 52.6% in 2013 to 74.0% in 2017.
  • 46.0% of Equilar 100 companies included a graph showing an alternative pay calculation separate from what is required in summary compensation table (SCT), such as realized or realizable pay, and 20.0% of companies included a graph that depicted executive pay in relation to company performance— however, both disclosures were slightly less prevalent in 2017 than previous years.