Wachtell Lipton’s updated edition of its always-instructive “Compensation Committee Guide” provides an overview of the key duties, legal standards, and disclosure requirements applicable to listed company compensation committees. The guide also addresses compensation methods and structures and associated legal considerations; shareholder proposals and related developments (including those involving ESG metrics); and suggested practices for effective committee operations—including committee composition, meetings, minute-taking, and approval processes—as well as director compensation and other topics.
The firm notes that the guide is also relevant to private companies, particularly those that may at some point consider accessing the public capital markets.
A model compensation committee charter—which also suggests provisions for committees with broad management development and culture responsibilities—is included as an exhibit for reference and potential tailoring to company-specific facts and circumstances.