Policy Development and Review
We advise on the respective roles of management and directors in a review of executive and directors’ compensation, including the design of the review process itself, through the development of specific compensation strategy and policy.
- The distinct roles of Management and Directors in the development process
- Compensation Review Process
- Minimum share ownership requirements for Management and Directors
- Compensation Philosophy strategy and policy, including:
- Peer Group definition and selection
- Relative weighting of pay elements (pay mix)
- Performance emphasis of variable pay
We advise on salary structure, annual incentives, long-term incentives, benefits, perquisites, termination, and change in control provisions.
- Salary structure and salary planning
- Annual cash incentives
- Long term incentives:
- Stock options
- Restricted Share Units (RSUs) / Performance Share Units (PSUs)
- Deferred Share Units (DSUs)
- Phantom share plans
- Long term cash plans
- Operational and financial benefits, perquisites and retirement arrangements
- Termination and Change in Control provisions
- Employee savings and share purchase plans
- Human capital metrics and performance objectives
We advise on corporate reorganization (divestiture and acquisition) issues, initial public offering, management succession, and retention plans.
- Change in control
- Corporate reorganization (divestiture and acquisition)
- Initial Public Offering (IPO)
- Management succession and retention plans
Data Collection, Analysis and Interpretation
We use our proprietary databases, proxy circular, and client compensation surveys when benchmarking executive and director compensation. We also benchmark our clients’ operational and/or financial/TSR performance relative to peers to ensure the compensation program is tracking the intended pay-for-performance relationship as per the client’s compensation philosophy.
- Executive and Directors’ compensation packages benchmarking
- Proprietary database leverage
- Proxy and compensation survey analysis
- Operational and financial performance benchmarking
- Compensation survey tailored specifically for oil and gas companies with international operations (the only survey of its kind in Canada)
Compensation Governance and Compliance
We advise on the role of the Compensation Committee in executive compensation and directors’ pay, annual CD&A preparation, investigation of institutional investor and proxy advisor guidelines and recommendations on compliance with these guidelines.
- The role of the Compensation Committee of the Board of Directors
- The role of Directors in Executive compensation and Directors’ pay
- Annual Management Information Circular and Compensation Discussion & Analysis (CD&A) preparation
- Institutional investor and proxy advisor (i.e. ISS; Glass, Lewis & Co.) guidelines and the applicability (or not) of these guidelines to our client
- Applicability of ‘good governance’ initiatives to a client’s stage of development and industry
We disseminate top-line performance metrics into their component financial and operational metrics at other levels in the organization.
Compensation Structure Development and Benchmarking
We ensure that the compensation philosophy mandated by the Board is enshrined in the compensation structure, including a definition of the competitive market, target positioning versus that market, and the reward versus performance relationship.
We configure both compensation planning software and equity plan administration software, to ensure that the treatment of items such as dividends, performance multipliers, severance, and change in control treatment is aligned with Board and shareholder approval of the use of these plans.