The Advisors' Blog

We’ve posted the transcript for our webcast “The Top Compensation Consultants Speak.” During this program, Blair Jones of Semler Brossy, Ira Kay of Pay Governance and Jan Koors of Pearl Meyer discussed what compensation committees should be learning about – and considering – today. They covered:

– The Compensation Committee Landscape in 2026

– 2026 Say-on-Pay Outcomes and Challenges

– Aligning and Disclosing Pay and Performance

– Special Awards Under the Microscope: Retention, Sign-On, Make-Whole and “Moon Shot”

– 2026 Equity Plan Approval Outcomes and Challenges

– Time-Based vs. Performance-Based Equity: Rethinking Vehicle Mix and Award Design

– Shifting Proxy Advisor Power: Be Careful What You Wish For?

– Competitive Strengths of the US Executive Pay Model

– Compensation Committees and AI

– Compensation Consultants’ View of Potential Disclosure Rulemaking

Here’s something Blair shared on “Time-Based vs. Performance-Based Equity: Rethinking Vehicle Mix and Award Design.”

There will be some companies that choose to adopt long-vested RSUs. I think there are going to be companies in highly cyclical or volatile industries with long business cycles and long-tenured employee populations that are willing to try it out. None of this comes without trade-offs, so the trade-offs to think about are: you lose the upside that PSUs provide, and when the upside happens, it’s really good. You don’t want to take that lightly. I do agree with Ira, you lose a lot of strategic messaging potential, and that’s an important thing to take into account.

Equity vehicles have historically been important messengers about what we’re trying to do and what’s important. When all of us see executive compensation programs work, they’re aligned with the strategy, and they hum along, and it’s perfect. If you have only time-based equity, and you don’t have the performance measures from PSUs, or you diminish them, then it puts a lot more pressure on your annual plan for those goals to be rigorous and for you to show a good pattern of improvement year over year. Aside from that, there are all sorts of administrative things to figure out about how you’re going to handle people coming and going in the organization, since you’re now dealing with five-year cycles. There’s a lot to figure out. Some companies will adopt it, and I do think it will be right for some companies.

As we all know, Exxon has had a similar design to this for a very long period of time. Boeing has now put in a hybrid version using long-vested equity for 2026, and we’ll see how that plays out. They pre-disclosed the design. We’ll have some good discussions around which companies end up adopting long-vested RSUs. The majority of companies are still likely to keep PSUs because they do have a lot of value to them, and we can work around some of the challenges of the goal setting and measurement to make them as effective as possible.

Members of this site can access the transcript of this program for free – and for the lawyers out there, you can also get on-demand CLE credit for watching the replay. If you are not a member of CompensationStandards.com, contact our team at info@ccrcorp.com or at 800-737-1271 to sign up today and get access to the replay and full transcript.

– Meredith Ervine