Executive Compensation Rules Changed with President Biden Tax Reforms -ESG Proxies
I wanted to quickly aware of my Compensation Committee Chairs, Chairman of the Board, and CEOs of Public Companies learners that the historic $1.9 Trillion Bill, Tax Reforms, signed this week by President Biden has Executive Compensation Rules Changed For Ever-Changing Future Proxies and ESG Compensation Reporting.
$1 Million Plus Salaried Individuals Scope, Definition and Reporting Expanded for More than Top 5 Salaried Executives. Proxy Season already had COVID Now Compensation More In Focus
Chairman of the Board and CEOs need to be aware that under the new Tax law that was just signed this week by President Biden, Executive Compensation has been completely changed for future Proxies and going forward.
What do I mean Covered Employees individuals making more than a Million US Dollars and 2017 in the Presiden Trump (Top 5) individuals were the CEOs the CFO and the Top five Executives and we reported on them and that was an exemption the IRS allowed but with the new Tax law, we have to not only consider individuals that were on that specific year
Once you made the list for the company (you were on it) part of the list but now Jan 1st, 2027 Public companies will be required to (Report) and keep two lists, one for these five individuals and then the next five so basically about 10 people and in a given year, each year this may go up and down, however, it would go? If somebody's making more this year.
Let's say this year the company needs to report that in their proxies and so forth why is this important how does this relate to ESG Sustainability in a year of COVID19 crisis in a year where the Public eyes are so much on Health, (safety) and Social Governance of Employees overall (CEO vs laid-off workers) Compensation for the top executives more visibility it puts a little more focus (Mainstream) on it.
Blackrock one of the largest Asset Managers has put and has been voting on proxies on (Executive) Compensation. So how does this (lime-light) relate to your boardroom, these are some of the challenges take a look at my blog in detail, I’ll explain and I'm happy here to help you more but I wanted to pass this quickly thanks.
I also wanted to talk about the S&P Global event, they had this week, great seminar ESG the new differentiator as you can see on the screen The big five topics for 2021 the managing director Michael Ferguson Senior Director, Sustainable Finance at S&P Global and Bruno Bastit (Director) S&P Global Ratings.
They talked about what are some of the major key trends in 2021 and of course persistent pandemic and standards for ESG Reporting and with the compensation that we were talking about a minute ago here they emphasized that ESG (Qualified) Directors are going to be a major need for Board of Directors with ESG qualifications and the big trend with compensation is they're looking at it is of course, the rise in social and sustainability issuance diversification on the board level and these metrics with the compensation are adding the visibility that you really don't want on your company, you want them to be in positive manner reporting to you, they talked about the transition to financing Net Zero (Sustainability) commitments and a lot of companies are committing to it 2050 so keep you posted and keep that in mind and there's more to come