Compensation Committee Charter (Word)

What it is

Charter for executive pay, incentive plans, succession input and adviser independence. It is a plain Word file you can edit, brand and adapt.

Who it's for

Chairs, board secretaries.

When to use it

Use it when forming a compensation committee, before an annual pay cycle, or at the annual charter review.

How to use it

1. Replace the bracketed text with your company's details, such as the number of members and meetings.
2. Compare the draft with your governing documents and any listing or regulatory standards that apply.
3. Have the board approve the charter, then review it each year and record changes in the minutes.

Preview of contents

• 1. Purpose: The Compensation Committee assists the Board in overseeing executive compensation, incentive and equity plans, and related disclosures, so pay supports long-term value…
• 2. Composition: At least [two/three] directors who meet applicable independence standards, appointed by the Board.
• 3. Meetings: At least [two/three] times a year, with an executive session at each meeting.
• 4. Responsibilities: Set goals for CEO pay, evaluate CEO performance against them and recommend or approve CEO compensation.
• 5. Advisers: The Committee may retain compensation consultants, counsel and other advisers after assessing their independence, and is directly responsible for their appointment, fees…
• 6. Annual review: The Committee reviews this charter and its own performance each year.

Get the template

Download the templateWord (.docx), 37 KB

Check your inbox for the download link.

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