Page 633 - Bruce Ellig - The Complete Guide to Executive Compensation (2007)

618 The Complete Guide to Executive Compensation

At the meeting, directors should discuss issues fully and, where appropriate, introduce
and consider advice from specialists in reaching a decision. Decisions should be the result of
the careful examination of sufficient information rather than the result of limited time.
The chair may wish to begin and end each meeting in executive session with only
members of the committee present. This allows them to express any comments or concerns.
When not in executive session, in addition to the committee secretary, it is common to
extend an invitation to the board chairman and CEO.

Meeting Minutes. The secretary of the committee will be asked to take minutes of the
meeting, and in accord with the ninth resolution on Table 10–3 file a copy with the board
of directors. Minutes should accurately reflect discussions and agreements consistent with
good corporate governance. An example is shown in Table 10–17. The secretary would be
expected to forward the minutes, a copy of the agenda for the following meeting, and any
supporting documents to the committee in advance of the next meeting. Because of travel
plans and other commitments by the committee members, it is helpful to send the materi-
als at least 10 to 14 days before the next meeting, providing them sufficient time to work a
review of the material into their own calendars.
Report to the Board. The committee secretary may be asked to script a presentation by the
committee chair to the board of directors reporting on the committee meeting. This request
is most likely to come from a new chair and/or one not well versed in executive compensa-
tion. Table 10–18 shows an example.
Brucell’s
Executive Compensation Committee Meeting for October 13 Meeting
1. The meeting at the company’s New York City headquarters was called to order by committee chair,
Ms. Right, at 7:00 am.
2. In attendance were committee members Ms. Right (Chair), Mr. Ready, and Mr.Able.There being no
items for executive session of the committee, it invited the following guests to join the meeting:
Ms. Reals (Chair and CEO), Mr. Brett (Vice President of Human Resources), and Mr. Evans of the
Evans compensation consulting firm. Mr. Brett served as secretary for the meeting.
3. The minutes of the September 8 meeting were approved by the committee as amended.
4. The chair asked for standing committee reports. Ms. Reals reported there were no organization
changes to report and Mr. Brett indicated there were no stock option exercise or sales by insiders
since the last meeting.
5. Ms. Reals reviewed the proposed change in the annual incentive plan that had been sent to the
committee on October Ist.The change would permit recipients an opportunity to defer (not later
than the day before the beginning of the bonus period) up to 50% of any award they may receive.
Executives would be permitted to choose between units of company stock or 30-year Treasury bills.
Mr. Evans supported the proposal as being competitive with peer company practice.After discussion
the proposal was approved.
6. The committee agreed its next meeting would be October 27 at 7:00 am at the company’s New York
headquarters to discuss a management proposal for change in control contracts.
7. There being no further discussion the non-committee attendees were excused and the committee
went into executive session.
8. The meeting was adjourned at 9:00 am.

Table 10-17. Executive compensation committee meeting minutes example