Here’s an excerpt from this Cooley Alert penned by Ali Murata and Michael Bergmann:
“And so, what does that type of summer reading list look like? The most logical first step probably is to look at your compensation committee meeting checklist and identify those items that would benefit from a head start, even (and perhaps especially) those items that are not fully ripe for some time, which could include things like the following:
- Evaluate how in-flight 2026 compensation programs are faring, and, as a result, whether there may be reason to give early thought to changes for the 2027 programs.
- Evaluate whether the existing programs are resulting in any unanticipated risks due to changes in economic and geopolitical circumstances since grant.
- Evaluate whether new-hire practices remain generally appropriate to avoid undue scrambling at the time of hire.
- Evaluate the adequacy of share reserves given dilution projections so that you can start marshaling support for an increase.
- Consider whether any additional clawback protections may be appropriate considering your circumstances.
- Evaluate the adequacy of compensation governance procedures generally and whether changes should be put in place for the coming compensation season.
- Give thought to whether the annual proxy disclosure could benefit from a fundamental refresh, which is a notoriously time-consuming exercise and ill-fitted to a pivot late in the year.
- Make sure any annual stockholder outreach is on track and preferably ahead of pace, whether driven by reason of say-on-pay results or otherwise.
Of course, if you don’t already have a compensation committee meeting checklist, one thing that should be near the very top of your summer list is to develop one. And, for companies that do have a checklist, another item for consideration is whether any changes in content or timing are appropriate.”
Authored by
Broc Romanek