First S&P 500 Pay Ratio Disclosures Coming in Late February

January 12, 2018

With the turn of the new year, the final countdown for the first pay ratio disclosures has arrived and many media sources, using the repeal of the 162(m) performance pay exception as a launching pad, have already begun discussing the gap between CEO pay and worker pay, foreshadowing the more extensive coverage ahead.  Upwards of 30 S&P 500 companies have already filed proxy statements for the 2018 proxy season.  However, these companies have fiscal years which ended before December 31, 2017 and thus none will be required to report their pay ratio in this year's proxy statement.  According to data from the Association's Center On Executive Compensation, the first proxies of companies that will contain the pay ratio disclosure are due to arrive in late February for early April annual meetings.  Among the first companies we expect to provide pay ratio disclosures are WestRock, Schlumberger, and M&T Bank.  The pending pay ratio disclosures have received international attention as well with Canadian and EU news sources covering the topic.  In the United Kingdom, the pay ratio is being closely followed as FTSE companies begin to prepare for their own pay ratio disclosure law under consideration by UK regulators and lawmakers, which is supposed to be in place later this year.  Although pay ratio numbers in Europe are typically comparisons to average employee pay, as the UK number will be (rather than the median), we can expect them to be compared with US pay ratios after disclosures start.  In preparation for the upcoming 2018 season, the Center will be co-hosting a pay ratio webinar with Equilar on February 1, 2018 from 1:00 – 2:00 P.M. eastern time, and HR Policy members are welcome to participate.  The call will discuss and analyze the results of a quick survey sponsored by Equilar on the pay ratio and median pay.  The survey is available here; a unique company ID will be necessary to complete the survey and can be requested here.  Registration for the call is available here. Please note that Center Subscribers have already received a separate invitation to this call.