Optimizing Equity Awards in a Down Market

This episode explores some of the standard and creative choices companies have in adapting, insulating and optimizing equity awards for stock market declines. Host: Jennifer Namazi, Content Director, NASPP Guest: Nathan O'Connor, Managing Director, Equity Methods Episode Notes: Trends and observations of an unprecedented 2020 (2:06) How equity compensation has grown in relevance this year (7:48) Key considerations companies face in restoring broken incentives (9:20) The mechanics of restoring incentives and 3 choices available (12:53) What is "discretion" and how is it different from modifying an award? (14:17) Exploring different flavors and varieties of award modifications (22:22) Thoughts on relatives performance equity and it's place in executive compensation (30:29) Predicting the future of the equity compensation landscape (32:12) Resources mentioned in this episode: Optimizing Equity Awards in a Down Market (NASPP Blog) Modifications and Discretion FAQ (Equity Methods) About our Guest: Nathan O'Connor is a Managing Director at Equity Methods, a consultancy that helps hundreds of public and private companies model, value and account for equity compensation and other complex securities. As the first point of contact for prospective clients, Nathan brings over a decade of quantitative consulting experience to bear in collaborating with the Valuation, Reporting, and HR Advisory practices within Equity Methods to ensure that prospective clients’ needs are met. As a liaison between the company and the broader compensation community, he shares best practices at industry events throughout the country and through publishing technical articles. Prior to his current role, Nathan served as the national valuation practice leader at Equity Methods, where he oversaw all client delivery, operations, and R&D in support of more than 400 public and private clients, in addition to directly serving the compensation consultants and senior executives of several Fortune 50 companies. A technician at heart, Nathan is a Certified SAS Base Programmer who has taught core finance topics in the University of Arizona’s MBA program and internal derivatives workshops at Equity Methods. He holds a B.A. in International Relations from Purdue University, an M.B.A. in Derivative Securities from the Quinlan School of Business at Loyola University Chicago, and an M.S. in Finance (PhD ABD) from the Eller College of Management at the University of Arizona. He previously served on the Board of the Las Vegas NASPP as Program Chair and the Phoenix Chapter of the NASPP as Secretary. Currently, Nathan serves as a Chapter Leader of the Arizona Chapter of Financial Executives International and an Advisory Board Member of the Certified Equity Professional Institute. Support the show