Compensation Solutions

Design Performance Awards, Metrics, & Goals

Performance-based pay now makes up the majority of many CEO pay packages and has led to much greater interest in award design decisions, with requests by boards and others for better data and analysis to support design choices.

Did you know that companies in the Russell 3000 use an average of almost six short-term performance metrics? And if it feels like metrics are always changing, you’re not alone – at least 60 percent of Russell 3000 companies change at least one performance metric annually.

Every design decision has an impact on the expected value of performance awards and the probability of achieving goals. Sophisticated modeling of performance awards helps take the guesswork out of design choices, adding more certainty to the process.

Our Award Simulator provides an innovative, flexible approach to using data and analytics in support of key design decisions. The Award Simulator uses state of-the-art Monte Carlo simulation to establish a clear line-of-sight on the value of performance awards. When designing an award you can assess the Expected Value and Payout Probabilities and understand how plan design influences award value.

Better design through better data.

  • Scenario Testing to test different scenarios and build effective awards
  • Goal Setting to model payout probabilities and set appropriate goals
  • Metric Selection, including benchmarking of metrics utilized by peers
  • Ongoing Monitoring of awards
  • Guidance on presentation of award design decisions

REPORT

Goal Acheivement in Performance Awards

A unique study evaluating actual performance results against target goals for earnings metrics for more than 2,000 companies.

This solution is part of ExecComp Platinum.

ICS’ ExecComp Platinum is a single-stop shop for everything you need to streamline your annual executive compensation lifecycle, from strategy setting to implementation and shareholder feedback. With our expert advisory, unparalleled data, and the unique lens provided by our analytical tools, we support clients throughout the year by providing a broad perspective balanced with relevant peer and industry insight. Clients around the world manage their programs using ECP, the most comprehensive executive compensation and equity plan benchmarking service available. Learn how you can too.

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