Big changes are on the way for Glass Lewis – a completely overhauled pay-for-performance strategy and a policy survey with a batch of pointed questions on executive compensation.
Why it matters: Glass Lewis’s goal is clear: recalibrate expectations, refine guidance, and build support for maintaining certain proxy disclosures.
Changes to Pay for Performance Strategy
Glass Lewis’s methodology will more closely resemble that of ISS. In addition to expanding the measurement period from three to five years, the firm is introducing two new tests: STI payouts versus TSR and CAP versus TSR for a total of five weighted quantitative tests.
- CEO STI Payouts vs. TSR: Compares the 5-year average CEO annual payouts as a percentage of target to general “market-based benchmarks” – which have not yet been defined.
- CEO CAP vs. TSR: Compares the ratio of 5-year aggregate CEO CAP to “market capitalization peers.” The criteria for peer selection have also not been disclosed.
- The final measurement will be based on a new 0-100 score, replacing the previous letter grade.
Survey Themes
- Time-based Shares: Not for Everyone? Building on last year’s data—where support for time-based shares with extended vesting gained traction, Glass Lewis is asking investors to draw the line: when are they reasonable? The survey floats nuanced scenarios – think high growth or newly public companies where rigid long-term metrics might stifle innovation and performance.
- Saving Proxy Disclosure. Seeking ammunition to recommend certain existing SEC disclosures remain intact, Glass Lewis asks respondents to rank the importance of specific reporting elements in evaluating compensation programs, including the SCT, Pay Versus Performance (CAP), pay ratio, and GAAP reconciliations.
- Pay Magnitude. Continued focus on the quantum of equity awards—particularly with make whole awards—citing a significant gap between investor and issuer expectations regarding the level of detail required to justify these pay decisions.
- Board Diversity. After a year of shifting disclosure practices and evolving investor views, Glass Lewis is asking what should be reported on board diversity going forward.
What’s Next? The Center will submit comments on behalf of members, but individual company input matters too. The survey deadline is September 15 and can be completed here.

Megan Wolf
Director, Practice, HR Policy Association and Center On Executive Compensation