GEO National Equity Compensation Forum 2011
September 15, 2011
SH&P Speaker: Steven Hall
Topic: Performance Metrics – Where one size does not fit all. Is TSR right for you?
A dynamic discussion of whether or not TSR (Total Shareholder Return) is the right metric to choose for a corporation’s performance based equity plans. Is it understood as a key driver by the employees it is designed to motivate? Can it be controlled (to any extent) enough to make it a meaningful tool to establish and modify behavior?
Discussion will include issuer case studies and comparisons, detailing studies of alternative metrics, and what was ultimately chosen), and why?
Presenters will also discuss related areas impacted by choice of TSR as the primary metric for their plans. Such as: Proxy Statement; Financial Reporting; Award Agreements.
Lastly, presenters will discuss the pros and cons as they have experienced them – with the choice of TSR as the defining metric in a performance plan.
- Define and discuss the history of TSR as the most common metric
- Advocates and detractors of TSR – which industry groups are promoting use of TSR and which question its effectiveness.
- Case studies: issuer panelists will describe times that they have used TSR, as well as times when another metric (industry specific goal, sales goals, or a mix of TSR with another type of measurement.
Issuers and industry experts will discuss challenges and success stories related to proper and complete education of the chosen metric in award agreement, benefit updates, employee and shareholder communications; among others.
Christopher Dohrmann, Executive Director, Morgan Stanley Smith Barney
Steven Hall, Founding Partner & Managing Director, Steven Hall & Partners LLC
Aaron Boyd, Director of Research, Equilar