Executive Compensation Clawbacks: 2014 Proxy Disclosure Study

Source: Ken Stoler, Nicole Berman, Ken Gritzan, PricewaterhouseCoopers (PwC), January 2015

From the summary:
PwC is pleased to share with you our second annual Executive Compensation: Clawbacks — Proxy Disclosure Study. This study presents our analysis of the compensation recoupment or “clawback” policies of 100 large public companies as disclosed between 2009 and 2013 in their year-end proxies. We hope this study will be helpful to those of you preparing proxies as well as those responsible for compensation strategy and financial reporting. Clawback policies, although not new, are top of mind for the C-suite and Boards and in compensation committee and annual shareholder meetings. And clawbacks continue to be discussed in the news and in the courts. CEO’s and CFO’s have been “on the hook” to return awards after a financial restatement, if earned as a result of misconduct, since passage of the Sarbanes-Oxley Act of 2002. More recently, the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 directed the SEC to craft new rules for additional clawbacks. As a result, we continue to see companies modifying their clawback policies in anticipation of the new SEC rules, which have yet to be issued. In fact, 40% of the companies reviewed made some type of change to their plan during 2013.