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Share Ownership Guidelines: How to Handle this Governance Golden Child

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July 31, 2014 | Barbara Baksa

Share Ownership Guidelines: How to Handle this Governance Golden Child

Our popular “Meet the Speaker” series, featuring interviews with speakers at the 22nd Annual NASPP Conference, is a great way to get to know our many distinguished speakers and find out a little more about their sessions in advance of the Conference.

For today's "Meet the Speaker" interview, we feature Geoff Hammel of ISP Advisors, who will lead the session "Share Ownership Guidelines: How to Handle this Governance Golden Child."  Here is what Geoff had to say:

NASPP:  Why is your topic particularly time right now?

Geoff: In our post-Sarbanes-Oxley, post Dodd-Frank world, getting governance right is no longer a "nice to have."  Rather, it's a necessary element of corporate survival.  By ensuring alignment of executive interests with those of shareholders, share ownership policies (share ownership guidelines + share retention requirements) represent a critical tool in a company’s corporate governance arsenal.  And while the prevalence of share ownership guidelines has remain fairly steady over the past five years, the use of share retention requirements as an enforcement mechanism has more than doubled during this same period.  This added wrinkle of share retention can add layers of complexity to the issuer/vendor relationship and is one of many administrative challenges we'll be covering in our session.

NASPP:  What are some best practices companies should implement?

Geoff: Many executives and Board members are starved for information about their share ownership guideline compliance status.  Frequent questions include:  What are my requirements?  Have I met them?  What happens if I sell after an upcoming vesting?  While measuring compliance with share ownership guidelines is most commonly a once-a-year process, we find that leading companies take a more holistic, ongoing approach to bridging potential knowledge gaps among its executive and Board populations.  Some companies have created modeling tools demonstrating the compliance impact of anticipated sale transactions.  Others have incorporated ownership guideline "chats" as part of the pre-clearance process.  But one theme that runs central through these best practices is that of more frequent, more expansive communications efforts.

NASPP:  What is a common misperception about your topic?

Geoff: With many companies trading at or near all time highs, share ownership guideline (SOG) compliance is a complete non-issue.  To which JFK may have responded—"the time to repair the roof is when the sun is shining."  As we'll highlight during our session, even the most basic SOG design can present formidable tracking and communication challenges.  Add in the fact that markets often fall faster than they rise and you have a compelling case to ensure your SOG compliance house is in order.

NASPP:  If you had a store on Etsy, what would you sell in it?

Geoff: Rainbow loom bracelets.  I've been classically trained by three of the best U10 loomers around.

Don’t miss Geoff’s session “Share Ownership Guidelines: How to Handle this Governance Golden Child” at the NASPP Conference!

About the NASPP Conference
The 22nd Annual NASPP Conference will be held from September 29-October 2 in Las Vegas. This year's program features 60+ sessions on today's most timely topics in stock compensation; check out the full agenda and register today!

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The National Association of Stock Plan Professionals is the largest and oldest professional association for the stock and executive compensation community, with over two decades of leadership providing expert resources, education and other benefits for our more than 6,000 members across 32 affiliated chapters.

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