July 5, 2022
CHRO Guide to the Expanded Role of the Compensation Committee
The Center On Executive Compensation recently published this 16-page guide on the expanded role of the compensation committee – including human capital management, talent strategy, and DEI. The guide acknowledges that each company is unique in how it approaches the evolving compensation committee. Yet, prevailing practices and innovative approaches from leading companies could give other companies ideas about how to move forward.
Here are a few of the forward-looking “best practices” gleaned from the 24 interviews that informed the guide. These relate to “talent management & succession planning below the C-suite” – which is one of the most common “new” responsibilities for committees, along with DEI, culture, pay equity, safety & well-being and retention:
– One company developed a two-page talent scorecard for the Committee. One page was devoted to the entire company’s workforce while the other focused on top talent; both showed statistics around hiring, retention, promotions and diversity.
– Consider the use of “HR Dashboard” including items such as and inclusion progress against goals, results of pulse surveys on engagement, success in hiring with key populations, wellness scores and employee hotline statistics.
– The Committee should consider the changing requirements of critical roles and how that changes their view of the talent pipeline. What will the workforce look like 5-7 years from now? Does the company have the development plans to meet the needs?
The guide also includes 4 sample committee calendars and a sampling of expanded committee names – e.g., Accenture’s “Compensation, Culture and People Committee.” For more analysis, benchmarking and instructions on the comp committee’s growing responsibilities, visit our “Compensation Committees” Practice Area. If you’re a member of TheCorporateCounsel.net, we have also posted a multitude of benchmarking surveys about governance practices in our “Corporate Governance Surveys” Practice Area on that site.
We’ll be diving into the latest steps that compensation committees need to take at our “19th Annual Executive Compensation Conference” – happening virtually on October 14th. Semler Brossy’s Blair Jones, Davis Polk’s Kyoko Takahashi Lin, American Water’s Jeffrey Taylor and Pay Governance’s Tara Tays will be sharing practical insights on “The Evolving Compensation Committee” that you don’t want to miss. Here are the full agendas for the “Proxy Disclosure & 19th Annual Executive Compensation Conferences” – 18 action-packed sessions over the course of 3 days – October 12-14th. Register today – sign up online, by email sales@ccrcorp.com or call 1-800-737-1271.
– Liz Dunshee