In The News

The “Buy-Side” View on CEO Pay

By David F. Larcker, Brendan Sheehan, Brian Tayan

Stanford Closer Look Series. Corporate Governance Research Initiative, September 2016

Executive compensation is a highly controversial topic. Journalists, governance commentators, and members of the American public believe that the majority of CEOs are overpaid. Missing from the discussion, however, is the viewpoint of the institutional portfolio managers that own shares in these corporations and make buy and sell decisions.

In this Closer Look, we review proprietary survey data from Rivel Research Group examining how institutional (“buy-side”) investors view CEO compensation. We ask:

  • How do buy-side investors and the general public differ in their evaluation of executive compensation?
  • Which constituency is “correct”?
  • What performance metrics are more effective in linking pay with performance: operating or stock-price metrics?
  • How much downside risk should an executive be exposed to?

Read full article >

Consensus among Global Investors that Brexit will Damage European Economy

June 16, 2016, Morningstar

Investors braced for stock market turmoil in UK and Europe if Britain leaves the European Union

With just a week to go to the EU Referendum, there is almost universal agreement amongst global investors that a Brexit vote would cause havoc on stock markets and damage both the UK and European economy. This consensus among investors seems in stark contrast to the divided views of politicians about the financial consequences of the UK leaving the European Union.

The study, by the Rivel Research Group, found that just 3% of UK investors thought the European economy would improve if Britain was to exit the European Union.

Read full article >

Just 3 per cent of UK investors expect European economy to improve in a Britain-less future

June 7, 2016, Pensions Age Magazine

Just 3 per cent of UK investors believe the health of the European economy would improve if Britain was to exit the EU, a new study by the Rivel Intelligence Council has found.

The negative sentiment towards a Brexit was stronger among continental European investors, as only 2 per cent of respondents expect the European economy to be better off in a Britain-less future.

Read full article >

Upcoming Conferences

New York City: Summer 2016

Wednesday, June 22, 2016: General Session
Tuesday, June 21, 2016: Pre-conference events
Read More

Targeting: Is Our Company’s Program Common Practice or Best Practice?

NIRI Annual Conference, San Diego

Tuesday, June 7, 2016 | 1:30PM – 2:30PM | Room: Grand Hall D

When you ask IROs what targeting means to them, you will get a wide range of answers. At the core, targeting is one of the most essential elements of an effective IR program and IR dedicates a lot of time and resources to it. In addition, IROs often have to educate their management teams on the buy-side’s deliberate and lengthy decision-making process. This reality lends itself to the question IROs often ask: is our targeting program common practice (the way we’ve always done it) or best practice (what the buy-side defines)? Explore how the targeting landscape is changing since investors only have so much bandwidth and are following over 120 companies on a given day.

  • Learning Objective 1: What are the most common ways in which public companies proactively reach out to targeted investors?
  • Learning Objective 2: How can you determine what metrics are most appropriate for your company?
  • Learning Objective 3: How can the application of both quantitative and qualitative practices help make your program more effective?

NIRI Annual Conference, San Diego