New Buck Research Shows Companies Will Be Reducing Equity Compensation Values - 24 Aug 2009

In a survey released today by Buck Consultants, most companies report
that they will not be delivering the same equity values to their
executives in 2009 -- a consequence of decreasing stock prices
resulting from the current economic downturn.

The
survey, “Taking the Pulse of Equity Compensation,” examines measures
companies have recently taken or are planning to implement in 2009,
with respect to equity compensation programs and executive pay. The
survey includes responses from 73 U.S. organizations, with 90 percent
of the participants representing publicly traded companies.

“These
reductions in value at the time of the grant are occurring because it
is very difficult for most companies to increase the number of options
or shares granted to offset the decline in each share’s value,” said
Buck Consultants compensation principal Larry Schumer. “However, if a
company’s share price were to eventually rebound to levels experienced
prior to the economic downturn, the gains realized by the executives
may actually be greater than the grants given in previous years. This
is a complex issue, and companies need to carefully examine the value
of equity compensation and how to best deliver it.”

The survey
results also indicate that 52 percent of respondents said there was
potential for no increases in executive base salary in 2009.

Other significant findings include:

·
Forty-three percent of respondents expect to decrease participation in
stock grant programs; more than half of companies cite significant drop
in share price as their reason for this change.

· Thirty-one
percent of respondents expect to somewhat increase the number of
options or shares to those receiving grants in 2009, although very few
plan to fully restore last year’s value.

· Changes vary
significantly based on equity compensation practices. For those issuing
equity compensation based on number of shares, 60 percent anticipate no
change in awards. For those issuing equity compensation on a
dollar-value basis, only 30 percent expect no changes in awards.

·
Forty-five percent of respondents are considering a change in equity
compensation mix. Twenty-nine percent will increase their use of
shares, and decrease use of options -– likely due to negative employee
perceptions of options since a large majority of existing grants are
underwater. Sixteen percent of respondents will increase their use of
options, and decrease use of shares -– creating the possibility of
delivering more future value from the increased number of options
granted.

Buck Consultants, an ACS company, is a leader in
human resource and benefits consulting with more than 1,500
professionals worldwide. Founded in 1916 to advise clients in
establishing and funding some of the nation’s first public and private
retirement programs, Buck is an innovator in the areas of retirement
benefits, health and wellness programs, human capital management,
compensation, and employee communication. News and other information
about Buck Consultants are available at www.buckconsultants.com. Buck
is an independent subsidiary of Affiliated Computer Services, Inc.

ACS,
a global FORTUNE 500 company with approximately 70,000 people
supporting client operations reaching more than 100 countries, provides
business process outsourcing and information technology solutions to
world-class commercial and government clients. The company's Class A
common stock trades on the New York Stock Exchange under the symbol
"ACS." Learn more about ACS at http://www.acs-inc.com.

The
“Taking the Pulse of Equity Compensation” report is available to the
media by contacting Ed Gadowski at 201-902-2825. It is available to
other interested parties at no cost from Buck’s Global Survey
Resources, 500 Plaza Drive, Secaucus, NJ, 07096-1533. Telephone
1-800-887-0509. It also can be ordered online at www.bucksurveys.com.

Media Contacts:

Ed Gadowski

Media Relations

Buck Consultants, LLC

201-902-2825

edward.gadowski (at) buckconsultants.com

Stephanie Hague

Media Relations

Boasberg Wheeler Communications

816-960-3015

shague (at) bwcom.com

This
press release was distributed through eMediawire by Human Resources
Marketer (HR Marketer: www.HRmarketer.com) on behalf of the company
listed above.



Author Information

Edward Gadowski
Buck Consultants, an ACS Company

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