The Advisors' Blog

– Broc Romanek, CompensationStandards.com

Check out this blog discussing a recent Towers Watson report – which you can find in our “Severance Arrangements” Practice Area – about the changing features of severance payments over the past several years. Among the most interesting changes are those related to the use of “single triggers” & “double triggers.” According to the report, there is only one Fortune 500 company continuing to use a “single trigger” that provides a severance payout upon a change-in-control – without requiring termination of employment. Here’s an excerpt about the findings:

According to the consulting firm, some 95% of the 340 Fortune 500 companies that offer severance upon a change in control now also require a corresponding involuntary termination of employment before they make a golden parachute payment. The prevalence of these “double-trigger” requirements has risen 10 percentage points for CEOs and 11 points for other named executive officers since 2010.

Also see this Washington Post blog about a movement to link severance packages to tenure & performance. And see this report from Semler Brossy about say-on-parachute trends…