Corporate Governance

2018 Corporate Governance & Execution Compensation Survey

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SEVERANCE ARRANGEMENTS Shearman & Sterling LLP 96 | Severance Arrangements of the Top 100 Companies have adopted policies capping the severance multiple paid to NEOs without shareholder approval. In all but four instances, the severance is limited to 2.99 times the NEO's base salary and annual bonus. In one instance, the multiple is 2.99 for the CEO and 1x base and bonus for all the other NEOs. Two companies utilize a 2x multiple, with one of those companies averaging the annual bonus paid over the three previous years. The fourth company limits the severance to one times base salary. SEVERANCE ARRANGEMENTS of the Top 100 Companies provide severance benefits to one or more of their NEOs 65 of these 65 companies provide severance benefits through individual agreements 14 25 $

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