In our August edition of Equilar’s Executive Compensation Trends, we highlight research that we recently conducted on CEO New Hire Compensation trends at S&P 1500 companies. Two of the six key findings from our analysis include (request a complimentary copy of the newsletter):

It Pays to Come from the Outside… Sad but True
In 2008, CEOs hired externally received the highest median total compensation package in all three segments (large, mid and small caps) of the S&P 1500 index. CEOs hired externally at large-cap companies enjoyed the largest premium in pay, receiving a median pay package that was 74.3 percent larger than the median pay package for tenured CEOs in the same segment. Mid-cap companies paid the smallest premium for outside talent, paying 6.7 percent more to externally hired CEOs. Small-cap companies paid a 25.8 percent premium for external hires versus tenured CEOs at other small-cap companies.

Lack of Succession Planning – Weaker Performing Companies Tend to Hire from Outside
It shouldn’t come as a surprise that companies that have underperformed (lower TSRs) tend to look outside for a new CEO rather than promoting from within. Conversely, companies with tenured CEOs, a sign of stability, had the highest median three-year total shareholder return in each segment of the S&P 1500 index.

To read about the other key findings or request a complete copy of the study, please click here.

Wanted – General Manager to Rebuild an Entire Franchise
External Hires will be Given Equal Consideration
Personally, I’m a fan of Omar Minaya and thankful for his resurrection of the Mets several years ago by bringing in Pedro and C-Belt and creating some excitement in my wife’s hometown of Flushing. However, it’s better than even money that the Wilpons will be making major changes this fall. Without a doubt, injuries were certainly a factor in the downfall of the Mets this year. But three straight years of missing the playoffs for a team with a $150 million payroll is not going to cut it in the Big Apple. And given that the malaise and level of mediocrity goes beyond the major league ballclub and permeates throughout the farm system, we need our own Obama to bring change to our once proud Metropolitans.

So who will the Mets bring in to take us back to the Promised Land of wild card contention? When Billy Beane’s name was mentioned in a NY tabloid, I finally found a reason to once again care about baseball. What better than to bring Moneyball to the Big Apple. Kind of like the Treasury throwing TARP funds at the Mets (warrants not included). Given that Billy Beane has built a team that’s won only three fewer games than the Mets with a $50 million payroll, imagine what he could do with an extra $100 million, especially when you have contracts like Delgado and Wagner going bye-bye this year. As every Met fan knows, ya gotta believe!

Equilar’s latest Compensation Insights newsletter includes a short article on how companies have gone about defining and analyzing the potential for excessive risk taking in their executive compensation programs. In light of the SEC’s recently proposed compensation disclosure rules, identifying excessive risk is an issue companies of all sizes are wrestling with. Below is an excerpt from our latest newsletter:

In addition to our article on defining excessive risk, the July 2009 Compensation Insights newsletter includes access to our latest report on CEO benefits and perquisites at Fortune 100 companies. It shouldn’t come as a surprise that a report on CEO perks is often one of our most widely read. A copy of the report can be requested here.

If you are interested in automatically getting updates, subscribe to our executive compensation newsletters by clicking here.

With another successful proxy season behind us, we are now entering one of the most exciting and innovative times of the year at Equilar. It’s the time when we deliver new products to the marketplace, expand our service offerings, and begin digesting all of the great information that proxy season brings. In sum, now that we’ve all caught our breaths after a whirlwind of compensation data and news, it’s time to take things to the next level.

With that in mind, I am excited to announce the launch of the next generation of ExecutiveInsight. The new ExecutiveInsight (a.k.a. the “New EI,” not to be confused with New Coke) promises to be a game-changer in the world of executive compensation benchmarking and analysis. By fully integrating public proxy information, proprietary survey results, and real-time 8-K and Form 4 data, the new ExecutiveInsight offers our clients unparalleled ease of use and access to the most complete set of Top 25 executive compensation data available.

Revamping and reinventing your flagship product has its own set of unique challenges. Yet, it is precisely because of today’s high-risk environment that the new EI makes sense. In a world where we have a ‘pay czar‘ to monitor and approve compensation arrangements at companies receiving Federal aid, directors, senior executives and compensation professionals need access to the most reliable, accurate, and timely information possible. We strongly believe that the new EI provides our clients with the tools they need to meet today’s challenges head-on.

From a features standpoint, the new ExecutiveInsight is fully loaded. It comes equipped with reporting tools that will allow our clients to generate boardroom-ready presentations in minutes, highly transparent and flexible user-defined methodologies, and the same trusted SureSource™ technology that allows for instant verification of all calculations and data sources. If you’d like to learn more, take a tour of the new ExecutiveInsight by visiting our online tutorial.

I’d like to close this post by thanking the members of our Engineering and Product Development teams who worked tirelessly in recent months and weeks to ensure a successful launch. Although building the new ExecutiveInsight was a company-wide effort, these teams truly excelled.

September Already?

Wow. What a rough series with our lovely Philthies this past week. I hate to admit it, but you have to tip your hat to Utley & Co. for once again shaking any confidence the Mets had at the beginning of the week. Watching our Putz-less bullpen blow two leads was too much to bear for June. Can we at least have five good months of baseball before the wheels start to fall off? To the Mets’ credit, given all of their injuries, it’s amazing that they’re only four games behind the Philthies and a half game behind in the wild card chase. But, after treading water in the deep end for the past month with the likes of Wilson Valdez and Ramon Martinez, it certainly feels like bowling balls are being aimed in our direction. First our hated Philthies, now come the Yankees who are looking for blood after getting eaten up by the Sox. Oh no!

For those following my blog, you may recall that I had written about the Client Advisory Board we formed last year. It’s been a great way for us to get candid feedback and input on our product direction and overall strategy. Last fall, we invited everyone to San Francisco for our annual meeting and had very engaged discussions on the pros and cons of various initiatives under consideration.

During these discussions, we identified an interesting concept which we developed into a new service launched earlier this year. As many of you know, our analysis is regularly cited by the media. Often, a number is provided but with little or no information on how the data was gathered and compiled. As a result, our clients, as executive compensation experts, will often be asked “where did that figure come from?” Well, wouldn’t it be great to have a service that provided detailed answers on how these numbers were calculated? Hence, the birth of Behind the Numbers (BTN), an innovative service designed to provide our clients direct access to the exact data behind the figures and analysis being cited by the media.

I want to thank our Advisory Board members for their input in helping this come together. Our discussions with them at the annual meeting and subsequent follow up calls were critical in making sure we did this right. And since launching the service last month, it’s quickly become one of the most active sections of our website. For example, I’d like to share with everyone an email from one of our clients shortly after our launch.

In addition, I am proud we continue to introduce innovative services to the market. As far as I know, I am not aware of any other information services firm in any industry that offers a similar service. It will be interesting to see if others follow our lead.

Spring Training Update

So whose heart stopped after reading about Johan’s elbow “tenderness”? Thank God we have a defibrillator in the building. I think the odds in Vegas for the Mets winning it this year went haywire when that news broke on that one. The Mets have been less than stellar when it’s come to the disclosure and treatment of “routine” injuries. Ryan Church and back to back concussions? Let’s keep our fingers crossed and hope that Johan gets his 30+ starts this year.