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ISS-Corporate Launches New ISSB-Aligned Sustainability Reporting Solution
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Short-term Incentive Metrics

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    Executive Compensation

    Short-term Incentive Metrics

    The Covid-19 pandemic sparked a shift in the metrics used to determine short-term CEO compensation, with more short-term incentive plans utilizing a greater number of metrics as well as more non-financial metrics since 2020. These levels have remained elevated even after the impact of the pandemic decreased.

    Research by ISS-Corporate found that increases in the number of metrics corresponds with notable increases in payout levels for CEOs across the S&P 1500. Our research also shows that above-median vesting does not clearly correspond to above-median performance, as measured by annual TSR.

    Download the report to discover:

    • Key Insights. The number of companies using more complex metrics has remained elevated even after the impact of the Pandemic decreased.
    • Short-term incentive vesting has been consistently elevated at companies using six or more metrics since at least 2018.
    • The Pandemic also kickstarted an increase in the use of non-financial metrics, which are often difficult for those outside a company to assess, across all S&P 1500 sub-indices, with the S&P 500 markedly elevated.
    • Our research showed that short-term incentive programs utilizing the most metrics (six or more), while volatile, show a downward TSR performance trend.