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Top 5 can assess your current programs and develop a balanced strategy for attracting and retaining outside directors.
As issues surrounding the role of the Board of Directors regarding their governance of a corporation have continued to generate negative publicity, many companies have begun to review the appropriateness of their Board of Director compensation programs and the role that the Board of Directors plays in the operations of the corporation.
In the past, companies have adjusted Board of Director pay in response to changes in company size and market capitalization. Today we see companies adjusting board compensation to reflect the increased responsibilities of board members as a result of the Sarbanes-Oxley Act. Additionally, competition for qualified directors is increasing; some current directors are limiting the number of board appointments that they accept, and there is a shortage of potential board members with specific types of expertise.
It is very important for companies to have an effective Board of Directors. An effective Board of Directors will understand the company's business and take an active role in major decisions. An effective Board of Directors needs members with the proper backgrounds, and needs to operate in a manner so that it efficiently carries out its duties.
One of the key factors in attracting the right type of directors is the compensation program that is offered by the company. One of the key factors in efficient board operation is having the board determine their mission and operating in a manner that allows that mission to be carried out.
Top 5 has significant capabilities in the assessment of your current programs and can help you develop a balanced strategy for attracting and retaining outside directors. Focusing on relevant peer companies and best practices, we review each element of Board pay, including:
To learn more about our consulting services, contact Jay Edelman (510) 745-8675 (email to jedelman@top5.com)
