WASHINGTON, June 21, 2012 (GLOBE NEWSWIRE) -- As part of an initiative to empower boards and shareholders to communicate more effectively in the area of executive compensation, the National Association of Corporate Directors (NACD) will produce a guide that helps boards develop pay plans to effectively compensate executives and articulate how these plans create long-term value for shareholders.
To ensure that the guide is both relevant and timely, NACD sought input on key elements of compensation strategy and stability from a delegation of Fortune 500 directors from NACD's Compensation Committee Chair Advisory Council last week. Representatives from large institutional investors, regulatory agencies, and governance advisors also provided suggestions.
The guide will be produced in partnership with compensation consultancy Farient Advisors and global law firm Gibson Dunn.
"This guide will address investors' needs to better understand companies' strategies regarding compensation, talent management and investor communications, in addition to improving proxy disclosures and peer group definitions," said Ken Daly, president and CEO of NACD. "As the second year of say-on-pay votes concludes, directors on compensation committees are under unprecedented pressure to define the strategy and rationale for their executive compensation decisions."
Noting the need today for relevant, compensation-related guidance, Robin Ferracone, executive chair at Farient Advisors, said, "Aligning pay for performance will continue to be a major focus for compensation committees and shareholders. This guide will provide recommendations on the processes and compensation programs that are sustainable for the future."
Members of the NACD Compensation Committee Chair Advisory Council include over 50 compensation committee chairs from Fortune 500 companies. Compensation committee chairs who attended last week's meeting included:
- William A. Coley, Peabody Energy
- Richard M. Donnelly, human resources committee chair, Oshkosh Truck Corp.
- Marsha Johnson Evans, Office Depot
- Brenda J. Gaines, Fannie Mae
- Claire W. Gargalli, Praxair Inc.; BioMotion Analytics
- H. Edward Hanway, Marsh & McLennan Companies Inc.
- Arthur C. Martinez, AIG
- Nana Mensah, Reynolds American
- Kathleen Misunas, Tech Data Corp.
- Georgia R. Nelson, Cummins Inc.
- Edwina D. Woodbury, RadioShack Corp.
- Charles A. Yamarone, United Continental Holdings Inc.
Stakeholders at last week's meeting included:
- Amy Borrus, deputy director, Council of Institutional Investors
- Carol Bowie, ISS research head, Americas Institutional Shareholder Service
- Robin A. Ferracone, executive chair, Farient Advisors
- Amy Goodman, partner, Gibson Dunn
- Thomas J. Kim, chief counsel and associate director of the Division of Corporation Finance, Securities and Exchange Commission
- Ronald O. Mueller, partner, Gibson Dunn
- Anne Sheehan, director of corporate governance, CalSTRS
- Christopher Wightman, senior manager, Vanguard Fund Financial Services.
About NACD
The National Association of Corporate Directors (NACD) is the only membership organization focused exclusively on advancing exemplary board leadership. Based on 35 years of experience, NACD identifies, interprets and provides insights and information that corporate board members rely upon to make sound strategic decisions, confidently confront complex business challenges and enhance shareowner value. With more than 11,500 corporate director members, NACD provides world-class director education, director training and proprietary research about leading boardroom and corporate governance practices to promote director professionalism and bolster investor confidence. Furthermore, to create more effective and efficient corporate boards, NACD provides independent board evaluations and custom-tailored in-boardroom education and training programs, as well as director-led conferences, forums and peer-exchange learning opportunities to share ideas about current and emerging issues. Fostering collaboration among directors and governance stakeholders, NACD is shaping the future of board leadership. To learn more about NACD, visit www.NACDonline.org. To join, please contact Kelly Dodd at kkdodd@nacdonline.org or 202-380-1891.
About Farient Advisors
Farient Advisors is an independent executive compensation and performance advisory firm that provides performance-sensitive and defensible advice on executive pay. Farient is uniquely designed to meet the ongoing and increasingly complex needs of compensation committees through a combination of top compensation advisors who routinely work with boards and executives. Farient's professionals adhere to disciplined processes and analytical standards to ensure the delivery of high-integrity services year in and year out.
About Gibson Dunn
Gibson Dunn is a top-tier global law firm that represents a broad range of clients in corporate, regulatory, transactional and litigation matters. It is consistently recognized as having one of the leading securities regulation and corporate governance practices in the nation; it received the 2011 Chambers USA Award for Excellence for securities regulation (advisory and enforcement).