Even though most U.S. public companies received strong shareholder support for their executive compensation programs during the most recent proxy season, nearly half of the respondents to a new survey by professional services company Towers Watson say they will revisit their approach to linking pay and performance ahead of the 2013 proxy season.

Despite that claimed focus, however, and even though the majority of companies said they pay executives based on performance, 40 percent have not actually conducted a pay-for-performance analysis to demonstrate support that claim.

The survey, conducted in September, found that 55% of the 253 public companies polled are introducing or enhancing the emphasis on performance-based equity, while 50% are changing the performance measures used to determine incentive payouts. These changes are taking place even though only 2% of those companies failed to gain majority shareholder support during their most recent say-on-pay votes.

While this may suggest that these companies are focused on setting high standards for executive compensation plans, the survey also found that only 61 percent have actually conducted a pay-for-performance analysis that compares the company's relative financial performance with its relative pay positioning. Also, only about half of the companies that conducted pay-for-performance analyses disclosed the results to shareholders in their public filings.

Asked why they decided not to disclose the results, companies gave a variety of reasons. Nearly 40 percent said they were waiting for SEC disclosure rules to be issued, while about three in 10 were concerned about setting a precedent that would likely require the disclosure of a similar analysis in the future, or said that the analysis didn't yield what was termed “incremental valuable information” to shareholders.

Other findings:

Among the companies that conducted a pay-for-performance analysis, 81% compared their performance to a company-defined peer group.

More than half of companies conducting analyses continue to rely on the pay required to be disclosed in the Summary Compensation Table when assessing pay for performance. While this may align with how proxy advisers have historically considered pay, there's growing interest in other measures of pay outcomes, such as earned pay and “realizable pay,” that take into account stock plan payments the Summary Compensation Table ignores.

In terms of measuring performance, 73% of those conducting analyses used total shareholder return, but most also considered other measures that reflect income statement and balance sheet results.

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