Board Oversight of Executive Pay: Compensation Committee Basics

Board Oversight of Executive Pay: Compensation Committee Basics | Mercer 2018

Our Thinking / Career /

Board Oversight of Executive Pay: Compensation Committee Basics
Board Oversight of Executive Pay: Compensation Committee Basics
Calendar27 March 2018

Compensation committee members are tasked with designing compensation programs for senior management in a way that links pay with performance, attracts and retains executives, aligns executives’ goals with the company’s long-term strategy, and avoids unnecessary risk-taking. Designing such pay programs requires a firm understanding of compensation committees’ fiduciary duties, along with the basics of setting executive pay.

This Director Essentials guide—co-produced by Mercer and NACD—answers questions such as:

  • How do you develop an executive compensation philosophy that supports the company’s business strategy?
  • What are the basic components and the mix of pay elements that are needed to support the pay philosophy?
  • How do we evaluate whether certain incentive plans are aligned with the company’s pay philosophy?
  • What role does the compensation committee play in engaging with shareholders?
  • How have the risks associated with compensation committee membership changed in recent years?

This article was originally published in NACD

  Speak with a Mercer consultant
We’re eager to speak with you. Please provide your details below.
*Required Fields