Below are key takeaways from ISS’ recently released 2024 Proxy Season Review – United States – Compensation. The full report is available to institutional subscribers by logging into ProxyExchange then selecting the Governance Exchange and its Report Center tab and to corporate subscribers by logging into Governance Analytics then selecting the Governance Exchange and the Report Center tab.
- Say-on-pay support ticked upward for the first time in several years, while the failure rate reached an all-time low. Median say-on-pay support levels increased for the first time since 2017. The say-on-pay failure rate decreased by nearly half to an all-time low of just 1.1% of proposals.
- Pay reached a historic high in the S&P 500. Median S&P 500 CEO pay was $15.6 million, which was the highest median level observed. Median CEO pay in the Russell 3000 was $5.3 million, which was up from the prior year but below the record of $5.7 million.
- Widening gap between S&P 500 and Russell 3000 CEO pay. The median S&P 500 CEO pay figure increased by $1.3 million, compared to a $300,000 median increase for CEOs in the Russell 3000. The $10.3 million gap in median pay levels between the S&P 500 and Russell 3000 is the largest dollar value observed between the indices.
- Equity plan support levels improved, though evergreen provisions remain prevalent. The median support level for equity plans increased by more than a percentage point in 2024, while the failure rate decreased from last year’s all-time high. The prevalence of problematic evergreen provisions in equity plans steadily increased, consistent with the trend observed in recent years.
- Support was down for compensation shareholder proposals. The number of compensation shareholder proposals on ballot declined and, in a reversal from the prior two years, zero compensation shareholder proposals received majority support in 2024.
- Golden parachute failure rate reached an all-time high. Average shareholder support for say-on-golden-parachute proposals decreased and the failure rate increased to an all-time high of 17%. This increase in failure rate was directionally aligned with a significant increase in the median CEO golden parachute compensation.
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By: Jolene Dugan, Rachel Hedrick, Kevin Kim, David Kokell, Kevan Marvasti, Chris Scoular, and Galen Spielman
