We are pleased to present a copy of our 2022 / 2023 Energy Compensation Report. This report analyzes compensation arrangements for executives and boards of directors at the largest U.S. exploration & production (E&P), oilfield services (OFS), and clean energy companies.
Please click below to explore the findings of the 2022 / 2023 Energy Compensation Report on our interactive page and download the full report:
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Key findings include:
Companies have shifted away from using cost metrics such as finding and development costs and SG&A expenses to focus their efforts on promoting health, safety, and environmental metrics and cash flow.
Time-vesting restricted stock / restricted stock units and performance-vesting awards are the most common forms of long-term incentive compensation, each utilized by at least 90 percent of E&P and OFS companies. For performance-vesting awards, relative total shareholder return is the most common performance metric, used by 95 and 67 percent of E&P and OFS companies, respectively.
In the context of a change in control, the most common cash severance multiples for CEOs are 3x or greater of compensation (applicable to 59 percent of the CEOs in this report), and the most common cash severance multiples for CFOs are between 2.00x to 2.99x of compensation (applicable to 75 percent of the CFOs in this report).
For clean energy companies, incentive compensation—including annual and long-term incentives—comprises approximately 87 percent of a CEO’s and 84 percent of a CFO’s total compensation package on average.
Effective compensation programs are critical to attract, retain and drive performance of executives. Boards of directors should ensure that their executive compensation programs are aligned with market throughout each potential phase of a company's lifecycle, including initial public offering, transaction/merger, steady state and bankruptcy. This report includes detailed market information on executive compensation.
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