Past CorpWar Issues

Last week a search client and CorpWar reader called with a unique compensation question about her troubled board. We couldn't answer the question so we called up our compensation strategist friend Tom Wilson of the Wilson Group (we use him for sensible compensation contracts for our senior search practice). Tom is an author of especially usable books on high-efficiency compensation and, just last month, did an article for Fortune magazine. I asked him the question and his answer was typical Tom: "Well it depends. Are they hiring a hired gun, or a favorite son?"

Now that's a GREAT sample of Tom-he's a true expert and has an opinion that isn't just more plain vanilla. Plus, while he's got the same data that the big guys have, he doesn't follow the big consultancy herd, choosing instead to create creative plans with a much higher ROI for his clients. Definitely a CorpWar kind of guy (e.g. "business is important, treat it like warfare"). If you have any comp issues and don't want just another canned solution, think about Tom-he's fast, modern and, like us, understands completely what the word "confidential" means.

Since we've been getting a lot of board questions lately I asked Tom to scribe a Point of View on the issue of sensible board compensation given these "peculiar" times. We've pasted in a piece of his pointed response below with a link to the full article (keep in mind these are Tom's views, not necessarily ours): 

Boards of directors, regardless of the company size or industry, are facing increasing pressures to exercise more independent governance over the companies they serve. They have always had the accountability for strategic decisions and ethical practices.  They have always sought to support shareholder interests and challenge executive decisions or policies if they felt the direction was inappropriate.  But, what has changed is the increased scrutiny to operate independent of executive management and assure decisions and actions of management support the long-term interests of stockholders. 

This change means that the demands on the director’s time are increasing.  Their decisions are often examined by shareholder interests groups and regulatory agencies.  Their risks and liability are increasing.  The job of a director has become more serious and they have been placed into the position of having accountability for people they do not manage—the top executives. 

Naturally this situation leads many members of boards to question whether or not to continue serving..

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