Endorsing the Task Force’s Five Guiding Principles
The Conference Board Task Force on Executive Compensation Sept. 21, 2009 issued recommendations for corporate institutions to restore credibility and increase trust in pay practices and oversight. As part of the outreach process, the task force is seeking endorsements of the report’s Five Guiding Principles.
To help in the decision-making process, The Task Force has created the following Web pages:
- A Power Point presentation that includes the Five Guiding Principles and a list of the endorsing organizations
- A copy of the full report
Convened earlier this year by The Conference Board Governance Center, the Task Force and its Advisory Group are comprised of corporate directors, shareholders, academics, and experts in compensation, governance and law. The full set of guiding principles and recommendations for compensation practices is outlined in the report: The Conference Board Task Force on Executive Compensation.
The Guiding Principles state that public companies should:
- Establish a clear link between pay, strategy and performance;
- Provide compensation that is fair, affordable and clearly aligned with actual performance;
- Eliminate controversial compensation practices that conflict with the notions of fairness and pay for performance – such as excessive golden parachutes, overly generous severance arrangements, gross-ups of parachute payments or perquisites, and golden coffins – unless specific justification exists;
- Demonstrate credible board oversight of executive compensation; and
- Foster transparency with respect to compensation practices and appropriate dialogue between boards and shareholders.