In her “Deep Quarry” Substack newsletter, Olga Usvyatsky has been reporting her observations on Dodd-Frank clawback disclosures. Her latest newsletter reports these data points on disclosures for the first half of 2026:
– The number of companies with an error correction flag declined to 142 in the first half of 2026, compared with 169 in the first half of 2025 (down 16% year over year) and 206 in the first half of 2024 (down 31% over two years).
– The number of companies indicating that they performed a recovery analysis declined to 57 in the first half of 2026, compared with 70 in the first half of 2025 (down 19% year over year), but remained substantially above the 29 reported in the first half of 2024 (up 97%).
– The number of companies providing recovery analysis disclosures declined sharply to 25 in the first half of 2026, down from 48 in the first half of 2025 (down 48% year over year), but remained above the 18 reported in the first half of 2024 (up 39%).
– Clawbacks remained rare, with 4 companies disclosing compensation recoupment during the first half of 2026, compared with 6 in the first half of 2025 (down 33%) and 2 in the first half of 2024 (up 100%).
– At the same time, several companies reported that their clawback analysis remained in progress. Four companies disclosed that their recovery analysis had not been completed by the filing date, compared with 2 in the first half of 2025 (up 100%) and none in the first half of 2024.
She notes that the 2026 decline is primarily attributed to the first quarter, since the second-quarter activity was mostly comparable year over year, and that the 2024 restatement levels were probably influenced by Borgers-related re-audits. I’m surprised at the second bullet point since the situations where the first box would be checked but not the second are fairly limited, but maybe voluntary restatements are more common than I realized. See this Cooley “Guide to the 10-K Clawback Checkboxes” posted in our “Clawbacks” Practice Area.
As Liz shared yesterday on TheCorporateCounsel.net, we had a lot of folks rushing to sign up last week for our “Proxy Disclosure & 23rd Annual Executive Compensation Conferences” – which are being held on October 12-13th in Orlando and virtually. Our “Early Bird” rate was set to expire on July 24th, but several members told us that they’ve been traveling and busy in July and they needed a few more days to get internal approval.
We want to do what we can to help, so we’re extending our “early bird” reduced rate by one week. Register by the end of this Friday, July 31st, to save on your in-person or virtual registration! You can register online or by contacting us at info@CCRcorp.com or 1-800-737-1271.
Here are the agendas for the Conferences – 14 sessions over two days – with a terrific speaker lineup, valuable course materials, and on-demand replay of all sessions for a year after the event:
– Christina Thomas: The Latest From Corp Fin
– The SEC All-Stars: Proxy Season Insights
– The Fate of Shareholder Proposals
– Fireside Chat with Top Activism Defense Lawyers
– Scary Stories to Tell in the (Securities Law Conference Spot)light
– Keeping Governance In Focus When the Future Is Hazy
– The SEC All-Stars: Executive Pay Nuggets
– Your Compensation Disclosures: New & Improved (We Hope)
– The Top Compensation Consultants Speak
– Bodyguards & Private Jets: Perks on the Radar
– Navigating ISS & Glass Lewis
Our early bird rates apply to both in-person and virtual attendance, so register online or contact us at info@CCRcorp.com or 1-800-737-1271 before the reduced rates expire – this Friday, July 31st!
Pay Governance’s latest viewpoint discusses considerations for pre-IPO companies considering the size of their initial equity plan share pools. In addition to sharing their own thoughts and tips, they base their recommendations on a review of 80 equity plans adopted by companies that went public in early 2026 and compared what they found with their 2022 findings. Here are their high-level takeaways:
– Share pool reserve: The median at-IPO reserve is 8.9% of fully diluted shares outstanding (“FDSO”), slightly above the 2022 median of 8.7%
– Overhang at IPO: Median overhang is 15.1% of FDSO, a modest increase from our 2022 study (14.4%)
– Evergreen provisions: Automatic annual refresh provisions (i.e., evergreens) remain highly prevalent at IPO, appearing in 80% of plans reviewed, representing a slight increase from our 2022 study. The most common evergreen amount was 5% of common shares outstanding (“CSO”)
– Industry differentiation: Life sciences and technology companies continue to be heavier equity users than other industries
Beyond these median data points, the viewpoint stresses that companies should consider their equity strategy and allocation levels and how those compare to peers in their industry, since that may be indicative of shareholder expectations.
If you haven’t already registered for our annual “Proxy Disclosure & 23rd Annual Executive Compensation Conferences” – happening October 12-13 in Orlando and virtually – now is the time to act! Our early bird rate expires tomorrow, July 24th. (The hotel block is going fast too – a lot of folks are taking advantage of the location and wrapping in family fun!)
Over on TheCorporateCounsel.net, Dave and Merdith recently elaborated onhow our sessions will help you understand the impact of the SEC’s regulatory agenda on your 2027 proxy season. We encourage you to use these blogs to help convey to your boss and colleagues the value that you can get out of attending our conferences before the early bird rate expires! Go check out our full agenda and speaker bios for even more detail.
Our early bird rates include discounts on both in-person and virtual attendance, so register online at our conference page or contact us at info@CCRcorp.com or 1-800-737-1271 before it expires tomorrow, July 24!
– Whether discretionary bonus programs warrant different sector-specific treatment for financial services companies rather than generally being treated as a concern in the qualitative pay-for-performance evaluation since financial services companies indicate that formulaic bonus structures are incompatible with applicable regulatory and risk management requirements
– Whether enhanced disclosure around the use of discretion by financial services companies would mitigate concerns
– How to signal significant concerns regarding executive pay when no say-on-pay vote is on the ballot given that more companies may be exempt if the SEC’s “Filer Status” proposal is adopted (e.g., whether to vote against compensation committee members and which members) and what support level for compensation committee members should be considered a low vote that triggers ISS’s responsiveness policy (the 50% director election threshold or the 70% say-on-pay threshold)
– Whether and when the risk of competitive harm constitutes a compelling rationale for not disclosing forward-looking LTI performance targets
– Whether the rationale of potential competitive harm is less compelling for relative metric goals than for absolute metric goals
The survey is scheduled to close on August 14, 2026, at 5 p.m. ET. In addition to the survey, ISS will conduct a series of regional, topic-specific roundtable discussions.
Meredith recently shared summer compensation planning activities that will make your “future self” happy. One key to that type of advance prep is understanding what you (and your compensation committee) can actually control given all of the external factors that may be affecting compensation programs. This Pay Governance memo offers helpful perspectives. Here’s an excerpt:
Drawing on discussions from hundreds of compensation committee meetings during the first half of 2026, we highlight the issues that are receiving the greatest attention in today’s boardrooms. In this first installment, we focus on the external forces influencing compensation committees, from market volatility, proposed SEC disclosure changes, evolving shareholder engagement practices, and the changing proxy voting landscape. To best address these developments, committees should:
– Define principles that guide the determination of any adjustments (e.g., adjustments to reflect factors outside of management’s control),
– Assess the pros and cons that would be associated with implementing the SEC’s proposed curtailed executive pay disclosure rules (for public companies with float below $2 billion), if finalized, and
– Seek input from their investors on how they are evaluating executive compensation structures in the current environment.
We’ve posted the transcript for our recent CompensationStandards.com webcast, “Proxy Season Post-Mortem: The Latest Compensation Disclosures,” during which Mark Borges, Principal, Compensia and Editor, CompensationStandards.com, Dave Lynn, Partner, Goodwin Procter and Senior Editor, TheCorporateCounsel.net and CompensationStandards.com, and Ron Mueller, Partner, Gibson Dunn & Crutcher, discussed the “lessons learned” from the 2026 proxy season that companies can start carrying forward into next proxy season. This was a jam-packed program! The webcast covered the following topics:
– Today’s Incentive Compensation Challenges
– The State of Say-on-Pay During the 2026 Season
– Experience with Proxy Advisors’ New Pay-for-Performance Analyses
– Shareholder Engagement Challenges & Responsiveness Disclosures in 2026 Proxy Statements
– BlackRock, State Street, and Vanguard Stewardship Approaches in 2026
– Compensation Clawbacks: Evolving Disclosures and the Coming Three-Year “Lookback”
– The 2026 Shareholder Proposal Process; Executive Compensation-Related Shareholder Proposals
– Proxy Advisors: Status of Lawsuits and Regulation
– Waning Proxy Advisor Power, the Rise of AI, Emerging Institutional Investor Policies and Managing – – Divergent Shareholder Views
– What’s To Come: Musings on Recent SEC Rule Proposals and the Impact on Equity & Compensation Disclosures
– What’s To Come: Musings on Potential Executive Compensation Disclosure Rulemaking
– What’s To Come: Musings on the Potential Overhaul of Regulation S-K
Members of this site can access the transcript of this program. If you are not a member, email info@ccrcorp.com to sign up today and get access to the full transcript – or sign up online.
Tune in at 2:00 pm Eastern to hear about the SEC’s proposed amendments to simplify the filer status framework and expand eligibility for scaled disclosure and other accommodations currently available to smaller or newly public companies (many of which relate to executive compensation disclosure requirements). Our panel includes seasoned practitioners and senior SEC staff:
– Luna Bloom, Associate Director (Legal and Regulatory Policy), SEC’s Division of Corporation Finance
– Howard Dicker, Partner, Weil, Gotshal & Manges LLP
– Raquel Fox, Partner, Skadden, Arps, Slate, Meagher & Flom LLP
– Dave Lynn, Partner, Goodwin Procter LLP, and Senior Editor, TheCorporateCounsel.net
They will discuss the SEC’s proposed rule changes and explore the practical implications of the new filer definitions and expanded accommodations. Topics include:
Overview and Policy Objectives of the Proposal
Revisions to Filer Classifications and Definitions
Expanded Accommodations and Scaled Disclosure
Initial and Annual Determinations of Filer Status; Transition Rules
Requests for Comments and Potential Changes to the Proposed Rules
Considerations for Companies Considering Scaled Disclosure
Relationship of the Proposal to Other SEC Initiatives
As usual, we will apply for CLE credit in all applicable states (with the exception of SC and NE, which require advance notice) for this 60-minute webcast. You must submit your state and license number prior to or during the live program. Attendees must participate in the live webcast and fully complete all the CLE credit survey links during the program. You will receive a CLE certificate from our CLE provider when your state issues approval, typically within 30 days of the webcast. All credits are pending state approval.
This program will also be eligible for on-demand CLE credit when the archive is posted, typically within 48 hours of the original air date. Instructions on how to qualify for on-demand CLE credit will be posted on the archive page.
If the Reg Flex Agenda is any indication, there’s more to come from the SEC and Corp Fin Staff, and there will be no shortage of things to talk about at our October Proxy Disclosure and Executive Compensation Conferences. Don’t miss our discounted “early bird” rate, which covers in-person and virtual this year. It expires on July 24th! Register online at our conference page or contact us at info@CCRcorp.com or 1-800-737-1271.
I recently noted that only a small group of companies has introduced explicit AI metrics into their incentive plans, and even those have typically weighted these metrics modestly. On the other hand, some select companies are going all in. Salesforce is one such example, and I wanted to share some of its proxy disclosures on AI metrics here, even though I risk stealing this proxy disclosure highlight from Mark and not doing it justice.*
Anyway, here are some snippets of sections of Salesforce’s latest proxy statement that got my attention:
From “Financial Highlights”: In Q4 of fiscal 2026, we introduced Agentic Work Units (“AWUs”) to measure tasks accomplished by an artificial intelligence (“AI”) agent, with 2.4 billion AWUs delivered to date across Agentforce and Slack.
From the Compensation Committee Letter: Previously, the performance-based option tranche was tied 100% to Agentforce & Data 360 ARR. For fiscal 2027, we are splitting that measure equally between Agentic Work Units (AWUs) and Agentforce & Data 360 ARR. This change reflects the evolution of our product strategy: AWUs are a direct measure of agentic activity and customer engagement, not just contracted revenue, and we believe they are among the most important leading indicators of where Salesforce is headed. Cash compensation and the PRSU structure — including the Rule of and rTSR split — remain unchanged.
From the CD&A “Summary Information on Fiscal 2027 NEO Compensation Decisions”: For fiscal 2027, we refined our performance option program to better align executive incentives with our long-term transformation and focus on accelerating Agentforce adoption. To prioritize the scaling of Agentforce, we introduced Agentic Work Units (AWUs) as a new performance metric. AWUs and Agentforce & Data 360 ARR will be equally weighted, with payouts based on fiscal 2027 achievement. Any earned options will remain subject to a four-year vesting schedule to ensure continued long-term alignment.
– Agentic Work Units: Measures discrete tasks executed by AI agents in production across the Salesforce platform, including Agentforce and Slack.
– Agentforce & Data 360 ARR: Measures annual recurring revenue through our Agentforce and Data 360 platform.
In addition, the performance options continue to have a direct tie-in to building stockholder value, as executives only realize value if our stock price increases above the stock price at the time the performance options are granted.
*Compensia’s Mark Borges has been blogging up a storm on his Proxy Disclosure Blog for members of CompensationStandards.com. He provides new, interesting or best-in-class examples of executive- or director-compensation-related proxy disclosures. Give it a follow!
Earlier this month, I shared some data on how companies are using one-time awards and noted that structural considerations are key to mitigating investor concerns. This Semler Brossy article (which Liz blogged about last month) compares the size of a special grant to the likelihood of an “against” recommendation from ISS. Not surprisingly, smaller grants, especially grants made to NEOs other than the CEO, are more likely to fly under the radar (i.e., not raise concerns).
Proxy advisors generally scrutinize special awards, but they do not uniformly recommend ‘Against’ programs that include them. Most awards are noted but do not have a substantial impact. Award size is a major indicator of whether a particular award will draw an ISS ‘Against’ recommendation. Smaller awards, while not immune from criticism, are accepted as a necessary reality by investors. Larger awards receive significantly less leeway, though those do not guarantee an ‘Against’ recommendation.
Among the awards Semler Brossy reviewed, if the award was less than half of target compensation, ISS recommended ‘Against’ about 25.8% of the time. Once the award was greater than three times target annual compensation, ISS recommended ‘Against’ 68.1% of the time. Many of the smaller awards were not the direct “cause” of the low vote but were instead caught up in broader circumstances, such as a pay-for-performance misalignment or an outsized award for another executive.
Over 1x target compensation seemed to be the level at which ISS was more likely than not to recommend against say-on-pay.