The Advisors' Blog

We’ve noted that more companies are seeing strong say-on-pay support this year. This FW Cook memo gives stats as of July 1st and notes that lower support seems to correlate with large “special awards”:

The 2026 say-on-pay season produced stronger results for most S&P 500 companies. Nearly 75% received at least 90% shareholder support, up from 70% in 2025, while the share below 70% declined
from about 6% to 5%.

The low-support group became smaller in 2026, but the remaining weakness was more concentrated. Large special awards appeared in half of the 22 cases below 70% support, and all five failed votes involved an outsized equity grant.

Among widely held companies receiving an adverse ISS recommendation, support topped out in the mid-70s and averaged 56.9%, lower than in any pre-pandemic year in the period reviewed. Much of that weakness was concentrated among companies with large one-time awards.

The obvious conclusion to draw is that companies that make large off-cycle awards are at greater risk of a low say-on-pay vote – by which I mean falling below the magic threshold of 70-80% that triggers heightened scrutiny of “responsiveness” in the following year. As the FW Cook memo notes, even awards that are performance-based can trigger a negative vote if they are large, the goals aren’t fully disclosed and/or the grant is in addition to the typical grant-cycle awards. Say-on-pay support may rebound in the following year if the company can show a return to its regular award program.

But reading between the lines, some companies come up short for reasons other than a large special award. That’s one reason why “responsiveness” disclosure may go beyond a commitment to avoid outsized grants (another reason is that companies may try to track what proxy advisors and investors say they want to see for “responsiveness” – e.g., ISS Exec Comp Policies FAQ 11). For real world examples, this report from Dragon GC looks at how companies disclosed “responsiveness” in the year following an adverse outcome. The report groups responsiveness disclosures into six categories and gives examples for each:

1. Engagement Strategy – Broad and Direct Engagement; Structured and Recurring Engagement; Targeted and Topic-Specific Outreach

2. Response to Feedback on Executive Compensation – Pay Reductions and Lower Award Opportunities; Restrictions on Special, One-Time and Front-Loaded Awards

3. Incentive Plan and Equity Structure – Incentive Plan and Performance-Metric Redesign; Increased Performance-Based Pay and Equity Alignment

4. Governance and Policy Reforms – Stronger Compensation Governance and Risk Controls; Compensation Committee, Board and Adviser Enhancements

5. Enhanced Transparency and Disclosure Improvements – Detailed Compensation Reporting and Proxy Enhancements

6. Retention of Core Compensation Programs – No Substantive or Minimal Program Changes

– Liz Dunshee