Deloitte's "Time to act: Applying discretion to outstanding incentive awards in the era of COVID-19" offers seasoned perspective on alternative approaches to COVID-19-prompted annual and long-term incentive plan changes based on its observations and experiences, and suggests a framework and a series of considerations relevant to stockholders and other stakeholders that may assist compensation committees and management in evaluating and supporting potential discretionary adjustments to incentive plan payouts.
The firm encourages outside-the-box thinking on annual incentive plan payout determinations and long-term incentive plan flexibility based on considerations that are unique to managing the business under extraordinarily challenging and unanticipated circumstances and other relevant factors.The report further documents COVID-19-related disclosures in SEC filings by type between February 2 and October 23, 2020 based on Deloitte's tracking tool, with withdrawn guidance, delayed financial reporting, and workforce reductions topping the list of disclosure topics.
See also Akin Gump's "2020 Year-End Key Executive Compensation and Employee Benefits Considerations"; our prior reports: "Executive Pay for Performance Discretion" and "Discretionary Pay Adjustments: Start Preparing Now"; and additional resources on our Executive Pay and Compensation Committees pages. This post first appeared in the weekly Society Alert!