August 2, 2019
Human Capital Management: Defining the Compensation Committee’s Role
– Liz Dunshee
Recently, Mike Melbinger gave some reasons why compensation committees may want to consider expressly taking on the responsibility of human capital management. This memo from Willis Towers Watson looks at what that role would typically entail. Here’s an excerpt (also see this Semler Brossy memo):
Collaboration would typically include a review and approval of HCM strategies and regular updates on the strategies’ execution and effectiveness. We would anticipate a greater level of granularity on key talent (regardless of level) and leaders (one to two levels below CEO), while the broader employee base would be managed in aggregate or by major segment/group.
In addition to the responsibility matrix, the board will need to specifically define the broad topic of HCM covering the entire employee lifecycle from recruitment and onboarding to talent development and succession. We suggest that a broad approach is likely required to address the full value of human capital throughout the organization. The investments that are made in support of this “asset base” will include the full employee experience and both monetary/nonmonetary programs.
Management should retain the actual development of HCM policies and practices, and their implementation. The board should step in to oversee strategy and implementation, to ask the right questions and to fully vet unresolved issues.
Reduced Rates Expire at the End of Today: Last chance – just a few hours left before reduced rates disappear. We’ll be discussing the compensation committee’s role in human capital management – and many other timely topics – at our popular conferences – “Proxy Disclosure Conference” & “16th Annual Executive Compensation Conference” – to be held September 16-17th in New Orleans and via Live Nationwide Video Webcast. Register by End of August 2nd for reduced rates. Here are the agendas – nearly 20 panels over two days.