The Covid-19 pandemic has brought about drastic changes for the global workforce and has had a distressing effect globally, impacting the job market with layoffs, pay cuts, and, in some cases, stopping rewards.
On the executive compensation front, we saw that many issuers announced pay cuts for their executives during the pandemic. For most of the issuers, the pay cuts were on the base salary which usually forms an insignificant proportion of executive compensation. Data from our compensation and governance intel (CGI) suggests that most executives withheld or canceled annual bonus in line with their company’s performance. On the other hand, long-term incentives on average grew, which could be explained by, for some companies, base salaries being deferred into long-term incentives.
Reba, Commentary, What are the after-effects of Covid-19 on reward planning? by Edna Frimpong