As discussed in this new post, according to a recent Equilar study, 37.5% of S&P 500 boards have at least one compensation committee member that is currently serving as a NEO at another public company. Of those, almost 28% had one outside NEO on their compensation committee; just over 8% had two; and about 1.5% had three or four. Drilling down further, currently serving CEOs occupied 9.3% of the 2,064 total compensation committee positions on S&P 500 boards.
As to why this may be worth thinking about, the post notes that although outside NEOs on the compensation committee may not be directly and immediately problematic in the context of independence or conflict of interest "violations," in the context of increasing scrutiny of committee composition by investors and other stakeholders, the presence and participation on the committee by these outside NEOs may pose indirect and longer-term problems if they either directly benefit from the "systemically escalating pay" (typically perceived to be associated with NEO compensation benchmarking practices) or if their personal or networking opportunities interfere with their independent decision-making.
Access additional resources on our Compensation Committees topical page.