Equity Plan Votes Scrapped After Tax Reform

William Woolston and Megan Woodford are quoted in Agenda regarding the Tax Cuts and Jobs Act of 2017’s effect on incentive plans. Mr. Woolston suspects public companies not conducting a shareholder vote on incentive plans is the “ beginning of a trend.” However, he believes that shareholders can still rely on other measures to hold companies accountable for their pay plans. “The proxy advisory services they deal with every year, they’re not going away. Say on pay and transparency [in compensation] are big issues that they still care about,” he says.

Ms. Woodford says, “[C]ompanies have invested in building out their compensation practices,” and does not expect any “radical sudden shifts,” despite several companies doing away with shareholder voting on equity plans. She says that companies can view the latest tax reform as “an opportunity for a fresh look” and to “rethink structures.”