Executive Compensation

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The following is part of our annual publication Selected Issues for Boards of Directors in 2026. Explore all topics or download the PDF.

On August 7, 2025, the Trump administration issued an executive order titled “Democratizing Access to Alternative Assets for 401(k) Investors” (the Executive Order), marking a step toward facilitating greater inclusion of investment options with exposure to alternative assets in defined contribution plans, including 401(k) plans (collectively 401(k) plans).[1] This development is noteworthy heading into 2026 for boards of directors overseeing companies that sponsor 401(k) plans, as well as those in the asset management industry.Continue Reading Alternative Assets in 401(k) Plans: What Boards Need to Know in 2026

The following is part of our annual publication Selected Issues for Boards of Directors in 2026. Explore all topics or download the PDF.

A number of changes to executive compensation disclosure may occur in 2026, reflecting potential Securities and Exchange Commission (SEC) rulemaking previewed during a July 2025 roundtable discussion as well as separate updates to guidance from ISS and Glass Lewis.Continue Reading Rethinking Compensation Disclosure

2026 promises to be a year that will demand both agility and strategic foresight from boards of directors and management as they navigate unprecedented challenges.Continue Reading Selected Issues for Boards of Directors in 2026

2025 promises to be another turbulent year for boards of directors. On the heels of a historically unprecedented election, companies are still ramping up compliance with the ambitious agenda of the outgoing administration while simultaneously bracing for the changes promised by the next one. Against that backdrop, colleagues from across Cleary’s offices have zeroed-in on the impact of the issues that boards of directors and senior management of public companies have faced in the past year, as well as on what can be anticipated in the year to come.Continue Reading Selected Issues for Boards of Directors in 2025

The following is part of our annual publication Selected Issues for Boards of Directors in 2025. Explore all topics or download the PDF.

Heading into 2025, boards of directors must be prepared to address both rising concerns around executive security costs and new Securities and Exchange Commission (SEC) disclosure rules relating to the timing of option and stock appreciation right (SAR) awards. We discuss the issues directors should consider below.Continue Reading Focus on SEC Executive Compensation Disclosure Obligations in 2025: Security Costs and New Item 402(x)

On July 30, 2024, the Ministry of Economy (the “Ministry”) of the United Arab Emirates (“UAE”) issued Ministerial Decision No. 137 of 2024 concerning the operation of the registrar of private joint stock companies (“PrJSCs”) and regulations and governance applicable to such companies (the “Decision”).[1]Continue Reading The UAE Government Clarifies Rules Applicable to Private Joint Stock Companies

On January 30, 2024, the Delaware Court of Chancery struck down Tesla CEO Elon Musk’s $55 billion performance-based stock option package, ruling that Tesla’s directors did not satisfy the stringent “entire fairness” standard in approving his compensation. This case comes on the heels of a $735 million settlement in which Tesla directors disgorged previously-received compensation following shareholder claims of unjust enrichment and breach of fiduciary duty.[1] The court applied the entire fairness standard because of Musk’s enormous control over the transaction, referring to him as a “Superstar CEO”[2] who wielded maximum possible influence over the board. While the compensation package was approved by a majority of disinterested shareholders, the court concluded proxy disclosure was deficient and therefore shareholders were not fully informed.[3] Ultimately, the Tesla board was not able to prove the benefit received from Musk’s leadership was worth the $55 billion Tesla paid for it.Continue Reading It’s Not DE, It’s You: 55 Billion Reasons Tesla is Not ‘Your Company’

The following post was originally included as part of our recently published memorandum “Selected Issues for Boards of Directors in 2024”.

Executive compensation issues may not have been the predominant focus for boards of directors in 2023 given the enhanced attention to antitrust, diversity and climate reporting matters, among others. However, there have been several notable developments in executive compensation that boards should be mindful of in 2024. We discuss these developments below.Continue Reading A New Season for Executive Compensation Disclosure

As 2024 gets off to a busy start, companies, boards and management teams are facing a host of new and developing business issues and a large array of regulatory developments, from new and growing risks and opportunities from the adoption of artificial intelligence, to ever-changing ESG issues and backlash, as well as enhanced focus on government enforcement and review. As has become a tradition, we have asked our colleagues from around our firm to boil down those issues in their fields that boards of directors and senior management of public companies will be facing in the coming year, yielding focused updates in eighteen topics that will surely feature at the top of board agendas throughout the year.Continue Reading Selected Issues for Boards of Directors in 2024

Earlier this week, the New York State legislature passed a bill banning all non-competes entered into on or after 30 days past the bill’s enactment, including those entered into by employees or in connection with the sale of a business.  If the bill becomes law, it would make New York the fifth state in the U.S. to enact a ban on non-competes.  California, Minnesota, North Dakota, and Oklahoma have also enacted bans on non-competes, but theirs do not go as far as New York’s full ban, instead banning only employee non-competes, but preserving those that are entered into in connection with the sale of a business.Continue Reading New York Advances Towards Banning All Non-Competes