TheCorporateCounsel.net

The community has spoken! On CompensationStandards.com, we have posted the 51 executive compensation disclosure tips that we received in response to our contest seeking ideas from our members. We will be announcing awards for these tips soon – take a look at them and let me know which ones you like best. Here’s the strange thing – I billed the contest as “51 tips” and I received exactly that number!

What is a “Severance Package”?

In the wake of Merrill Lynch CEO Stanley O’Neal’s resignation, there were some articles noting that he didn’t have a severance agreement with the company. Here are some thoughts from The Corporate Library on the topic:

“In a study released last week, The Corporate Library reports that the “non-severance” package awarded to O’Neal is not what it seems. Long rated a high concern board by The Corporate Library, Merrill Lynch’s actions are deemed too little, too late, by Paul Hodgson. ‘Stanley O’Neal’s departure from Merrill Lynch with ‘no severance’ and no 2007 bonus would seem to present a picture of a decisive board in control. Yet, when ‘no severance’ equals $161.5 million and an office and executive assistant for three years, what else did they think they needed to give him?’” Notably, Mr. O’Neal’s separation package comes in at #5 on a list of 10 of the most excessive severance packages this decade.

In addition to the severance panel discussion during the recent “4th Annual Executive Compensation” Conference, we have written quite a bit on severance and steps you should be taking to fix outstanding arrangements (and not make the same mistakes going forward) – look for more in a Special Supplement to the Compensation Standards print newsletter coming out very soon. Sign up for complimentary copies!

CII on CD&A

Back in September, the Council of Institutional Investors sent this letter to the SEC explaining what it seeks from companies when it comes to the “Compensation Analysis & Disclosure” section of the proxy statement. It’s interesting to compare CII’s letter to John White’s speech and the Corp Fin Staff Report that came out subsequently. For the Jan-Feb issue of The Corporate Executive, we are busily writing analysis (and model language) about what CD&As should look like next year – we hope to have that available within a month.

– Broc Romanek