Executive Compensation Certificate Program

by | Sep 16, 2024 | Uncategorized

 

In today’s environment, Senior Executives and Boards of Directors are under unprecedented levels of scrutiny compared to even a decade ago. Optimally, Executives and Boards should not only comply with their responsibilities and fulfill their fiduciary duties; they should also add real value to the organization they govern. The AECP certificate program will not only educate executives on governance techniques, best practices and the evolving regulatory environment, but it will also help the participants better address stakeholder concerns and enhance organizational value. We are happy announce that we will be offering a virtual and an in-person program to complete the AECP and earn the AECP Certificate. Both offerings this Fall qualify for 20 continuing professional development (“CPD”) hours for HRPA and CPHR Alberta members.

The program is delivered by experts in the fields of executive compensation, governance, legal, and actuarial science, the Executive Compensation Program covers 11 important topics within the areas of:

  1. Executive Compensation Reviews
  2. Executive Compensation Plan Design
  3. Corporate governance and Oversight

Learning Objectives:

  • Gain an understanding of the fundamentals of total executive compensation design
  • Be equipped to manage the process to hire the Board’s independent advisor
  • Understand all aspects of the executive compensation governance process
  • Improve your effectiveness of your specific role within your organization
  • Understand today’s regulatory environment with respect compensation and disclosure
  • Know what questions to ask the independent advisor
  • Have sufficient knowledge on how you can manage the board and support their fiduciary duties
  • Obtain reference material that will provide useful reminders and guidance throughout your annual executive compensation governance cycle
  • Be equipped to provide the Board with guidance on making defensible executive compensation decisions as well as the mitigation of risk and shareholder revolts

Who should attend this program?

Senior management, executives and board members looking to:

  • work with their senior executives, CEO and boards to guide and manage the executive compensation process in their organizations,
  • design and validate an effective executive compensation plan,
  • use executive compensation as a tool for attracting, retaining, and incenting their leadership teams,
  • implement best practices in corporate governance and oversight related to executive compensation, and
  • fulfill their fiduciary duties while also adding real value to their organization

VIRTUAL PROGRAM: The first offering is delivered virtually in partnership with CPHR Alberta and Calgary Total Rewards Network (“CTRN”) from October 22nd to the 24th. CPHR Alberta members qualify for a preferred rate of $1,000 for this offering and any non-members $1,250+ tax. Registration deadline is October 18, 2024.

This certificate program combines live virtual instruction through Zoom with hands-on experiential learning through case studies, scenarios, group work/break out discussions and simulations. There will be online instructor-led modules, during which practical examples and experiences will be shared.

There are two ways to register as a member or non-member for this course:

  1. CPHR Alberta: Executive Compensation Certificate Program (Oct 22 & 23 8am – 4:30pm and Oct 24 8:00am – 1:00pm) | CPHR Alberta (cphrab.ca)
  2. CTRN Calgary Total Rewards Network – Global Governance Advisors Executive Compensation Certificate Program

IN-PERSON PROGRAM: There is an in-person offering in Toronto, Ontario delivered in partnership with the Human Resources Professionals Association (“HRPA”) from November 11th to the 13th hosted by our friends at Odgers Berndston.  The in-class virtual modules (live sessions) will be held as follows: Part 1: Executive Compensation Reviews, Part 2: Executive Compensation Plan Design, and, Part 3: Corporate Governance and Oversight: Executive Compensation Plan Design.  HRPA members qualify for a preferred rate of $1,300 and any non-members $1,500+tax. Registration deadline is November 4, 2024.

There are two ways to register as a member or non-member for this course:

  1. HRPA: HRPA Meeting Details
  2. Email: Tammy Penacho at GGA – tammy.penacho@ggainc.com

GGA’s Annual CEO Pay for Performance Survey with the Globe and Mail

by | Jul 11, 2024 | Uncategorized

GGA and the Globe and Mail partnered once again to present our annual ranking of CEO compensation for the 100 largest public companies in Canada’s S&P/TSX composite Index.

Full results here.

Key Findings

  •  Average total reported compensation increased by ~10% while the median total reported compensation remained flat
  • The majority of the total compensation increase was tied to an average 20% and 11% increase in share- and option-based awards respectively, further increasing the weighting of CEO compensation on long-term, at-risk compensation

 

  • The highest paid CEO, in this year’s study, was Patrick Dovigi of GFL Environmental Inc ($68.46 Million).
  • The second and third highest paid CEO’s were granted about half the value of the highest paid CEO at $37.7M and $36.8M.
  • Performance vesting share-based awards (“PSUs”) were the most prevalent form of long-term incentive-based compensation (“LTIP”), granted at 79% of companies.
  • Among the 85 companies that awarded a cash bonus to the CEO, 67% (N=57) paid above the target level, indicating generally strong operating performance in 2023 at these companies.
  • Female CEOs were still underrepresented, accounting for 4% of all CEOs (down from 5% in 2022) in this year’s study.
  • Average annual total shareholder return was 15% (up from 4% in 2022).

There is an increased weighting on share-based awards over option-based awards. This continues a trend observed by GGA in recent years amongst the largest companies in Canada.

Our analysis shows that share-based compensation is the major reason why CEO pay is climbing in Canada. Of the 100 companies included in the ranking, 77 granted multiple forms of LTIP in 2023, compared to 73 in 2022. The LTIP, which refers to the long-term incentive component of the CEO’s compensation package, includes options and share-based awards such as PSUs and Restricted Share Units (“RSUs”) which vest solely over time with no additional performance conditions. In recent years, we have been observing an increasing prevalence of PSUs, a form of equity compensation that vests only if certain performance criteria are met which is designed to better align CEO pay to shareholder value generation over time.

With growing emphasis on share-based compensation, we have seen a shift away from options. GGA’s Peter Landers discussed this trend in an interview with the Globe and Mail, stating, “There definitely is a movement away from options, just because the nature of the scrutiny they’re under by institutional shareholders, tax implications and the lack of ability to really grow and make those stock options worthwhile to the individuals.” When looking at our data, we see that 43 companies in the top 100 did not grant any options in 2023. In cases where companies award options, they generally only tend to account for 25% of the LTIP grant, with the remaining 75% being allocated to PSUs and/or RSUs. This trend is expected to continue as Canada’s increased capital-gains tax inclusion rate takes into effect, making stock options even less attractive in the future.

Full story here.

Reach out to us at Global Governance Advisors to learn how our board services can help you address regulatory and shareholder challenges related to executive compensation.