Issue link: https://digital.shearman.com/i/1035494
Shearman & Sterling LLP Clawback Policies | 89 COMPENSATION SUBJECT TO CLAWBACK The Dodd-Frank Act compliant clawback policies will require companies to recover "certain incentive-based compensation (including stock options)." The SEC's proposed rules define incentive-based compensation as including both cash and equity compensation, but time-vested awards are not covered. While voluntary clawback policies generally permit a company to recoup "incentive compensation," the forms of incentive compensation that may be recouped vary. Who maintains the enforcement discretion under the voluntary polices currently in place? * At one Top 100 Company, both the compensation committee and audit committee retain the discretion. Compensation committee* Board Both the board of directors and the compensation committee Audit committee* Section 16 committee Not specified 24 6 14 1 22 1 Of the 92 Top 100 Companies that maintain a clawback policy, they may recoup: Both cash and equity Cash only Equity only Not specified 7 8 14 6 71 Of the 92 Top 100 Companies that maintain a clawback policy: Retain discretion as to whether to seek enforcement 65 Provide for both mandatory and discretionary enforcement, depending on the triggering event 3 Not specified 11 Appear to provide for mandatory enforcement 14