What is the purpose of a compensation committee on the board of directors? Their role is to oversee compensation plans for the CEO and the company’s other senior executives. Topics of focus for the committee may include say on pay, executive performance targets, disclosures relating to compensation, shareholder communications on pay and CEO succession planning.
In recent years there has been growing scrutiny of CEO compensation and, in particular, its link to company performance and risk-taking. This has put the compensation committee in the spotlight. The Dodd-Frank Act imposed additional requirements for compensation committees including significant new disclosure requirements.
The Governance Insights Center provides resources that help boards of directors and compensation committee members gain knowledge and stay abreast of issues specifically relating to the role the committee plays.
We take a close look at the drivers behind the interest in executive compensation in a new series PwC co-authored with Cleary Gottlieb Steen & Hamilton LLP. Featured topics include: