Among financial institutions, it’s been more of a mixed bag, with bigger winners and bigger losers than in recent years, said Alan Johnson, president of Johnson Associates.

“Usually there’s a vignette or two, but there are multiple this year,” he added. “We haven’t even had the debt crisis yet. It’s more uncertain and there’s greater variety than we would typically see.”

Compensation committees will have to have to take a closer look at how the uncertainty is affecting their company specifically when deciding incentive pay targets and payouts.

“Some years, you can put out a generality and say markets are up 20% or markets are down 20%,” Johnson said. “This year will depend on the bank or the firm; different departments may be up significantly, different departments may be down significantly. So, it’s not going to be a consistent, easy story. Do your homework — you’re going to have to know the markets you’re in, what’s really going on in those markets. This is going to be a year where the committees are really going to have to dig in.

“It’ll be disappointing,” Johnson said. “A majority, not all, but a majority of people will be disappointed.”

Agenda / May 30, 2023