Resource Library Insights

As Committees set compensation amounts and structure, five key questions can inform their decisions.

By minimizing discretion, directors give consistent direction to management. They avoid what might be perceived as forgiving poor results and forestall potential criticism from proxy advisory firms. 

The turbulent events of 2020 have heightened many American corporations’ sense of political and social responsibility. With the pandemic exacerbating income inequality and climate change still a long-term threat, investors and critics are calling on companies to care for all stakeholders, not just investors. Many boards are attending to their long-standing interests in environmental, social and governance issues more than ever before.

Since the Business Roundtable’s 2019 call for greater attention to all stakeholders, corporate boards have been elevating environmental, social, and governance issues in their discussions.

Given growing stakeholder focus on Human Capital Management (HCM), we sought to understand how companies would approach the HCM disclosure within proxy statements this year. Our study of a sample of proxies filed in December 2020 and January 2021 offers an early proxy season preview of HCM disclosure practices.