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Guideline
We will review management compensation plans on a case-by-case basis. We review the features of each plan and determine whether the plan on the whole is reasonable.
Discussion
Companies are facing increasing pressure to provide meaningful justification for their compensation policies. We look to support compensation plans with some or all of the following features:
- clear statement by the board of directors of its executive compensation philosophy and how this philosophy is related to the company's strategic objectives;
- incentives for performance that address both short- and long-term corporate objectives that we believe will be stable and not require alteration through the company’s business cycle;
- a minimum one-year post-retirement hold period, although we prefer two years
- minimum share ownership requirements;
- meaningful industry and company performance metrics for both the awarding and vesting of incentives;
- full disclosure of all benefits including the present value of pension benefits and supplemental executive retirement plans in the compensation table in the management information circular;
- identification of changes in philosophy or performance targets.
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