June 30, 2009
Towers Perrin and Watson Wyatt Will Combine to Form “Towers Watson”
– Broc Romanek, CompensationStandards.com
Yesterday, two of the heavyweights in the compensation consulting business agreed to merge in an effort to cut costs through job cuts and streamlining operations. Under the deal, Towers Perrin (a privately-held entity) and Watson Wyatt (a public company) will combine to form “Towers Watson.” The combined company will have 14,000 employees which reportedly will rival Hewitt and Mercer as the largest compensation advisory firm. Here is a Washington Post article.
Okay, the big question for those of us focused on CEO pay – what will happen to the board advisory practices of the firms. As I understand the answer (made in response to a question asked about the consultant independence issue on the merger conference call yesterday afternoon: “They are committed to all aspects of our human capital practice and will plan on integrating the two practices once the deal goes through.”
That sounds like the right answer for a deal that needs to get through. Of course, the answer could change suddenly – either in response to client demands for independence or to the SEC executive pay proposals that become public tomorrow. Does “Towers Watson” sound too much like Sherlock Holmes lore? Maybe “Towers Wyatt” would have been better?