In the 2024 proxy season, 21 self-managed REITs received a negative Say-on-Pay voting recommendation from ISS (up from 19 in 2023). A perceived pay-for-performance misalignment continues to be the main precursor of negative voting recommendations from ISS, with 50% of self-managed REITs that received an “Against” voting recommendation cited for CEO pay-for-performance misalignment. Other factors cited by ISS as contributing to the negative voting recommendation included the following: Lack of rigor in setting performance goals Lack of sufficient performance criteria for cash bonuses and/or LTI Insufficient disclosure surrounding incentive program metrics or goals Problematic severance-related provisions No reduction in LTI payouts in the event of negative TSR Problematic LTI (Equity) program design 59 | 2024 Guide to REIT Executive Compensation
RkJQdWJsaXNoZXIy NTU5OTQ5