Quarterly Compensation Checklist

Throughout the Year:

  • Review the Charter for the Compensation Committee to the Board (annually)
  • Review and approve Compensation Committee meeting minutes
  • Review new hire/promotion compensation arrangements for Section 16b officers

First Quarter:

  • * Review and approve the appropriateness of financial measures used in incentive plans and the “stretch” required to achieve specific performance targets
  • Prepare proxy report for public shareholders
  • * Recommend to the Board compensation for the Board of Directors
  • Evaluate and report to the Board on the performance of the CEO and any resulting compensation decisions
  • * Review and approve prior year’s performance and resulting bonuses for plan participants.

Second Quarter

  • Review areas of particular difficulty in attracting/retaining staff, progress/development of senior officers during the year, and succession planning
  • * Review and approve management’s decisions with regard to salary, bonus, equity grants, and other compensation for elected officers and discuss officer development needs

    • Third Quarter

    • * Review compensation philosophy statement including alignment with the company’s strategic plan, program objectives and peer group of companies for compensation/financial comparison purposes
    • * Assess the ongoing competitiveness of the total executive compensation package
    • * Approve the initial design of and subsequent amendments to any incentive compensation (bonus) plan, equity participation plan, supplemental executive benefit plan, or termination plan
    • * Discuss/evaluate the role of equity and share ownership goals/guidelines for elected officers
    • Review how the executive compensation program is communicated to participants

    Fourth Quarter

    • Review and approve management’s recommendations with regard to the aggregate merit increase budget and guidelines
    • * Approve aggregate awards under various incentive arrangements (i.e., stock option plan, annual bonus plan, and sales incentive plan)
    • Review and approve contributions to retirement plans and savings plans
    • Recommend to the Board the annual salary level and short and long-term incentive opportunities for the CEO
    • Evaluate any specific compensation-related actions with regard to elected officers which would fall outside established policies and guidelines

    * = Compensation Consultant Input Recommended







    Delves in the News

    Boardmember.com "Managing Risk-Linked Compensation"

    Forbes "How to Use Compensation to Manage Risk"

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