Managing Director Bill Reilly was quoted in the WorldatWork Workspan Daily article, “Companies Are Increasingly Pinning Executive Comp to HR Metrics.”
Based on disclosures filed in 2025, a WTW report found 34% of S&P 500 companies continue to pay a portion of executive incentives based on standalone diversity, equity and inclusion (DEI) and environmental, social and governance (ESG) incentive plan metrics, a decline from 55% last year. Additionally, 23 (or 5%) of the S&P 500 companies disclosed plans to remove DEI metrics from their executive incentive plans for the current plan year.
That trend aligns with a recent study conducted by executive compensation advisory firm Pearl Meyer, which cited “a restrained use” of discretion in incentive payouts and “a notable pullback” in standalone DEI and ESG incentive plan metrics.
“That’s largely due to the external backlash to DEI and ESG from the [current US presidential] administration and external forces in general,” said Bill Reilly, a managing director at the firm.
Nonetheless, he said, companies are increasingly recognizing the importance of board oversight of human capital to ensure they can attract, retain and motivate workers with the right skill sets.
“Years ago, compensation committees would have only focused on executive pay, not broader human capital topics," Reilly explained. "We now see an increased prevalence of oversight on succession planning, talent development and even culture.”
To that end, more than half of the board respondents reported in the Pearl Meyer survey that their involvement in their organization’s human capital matters and metrics was “moderate to high,” which Reilly said is “trending in the right direction.”