Board of Director Compensation & Program Design
A distinct compensation need is that of defining appropriate compensation levels and incentive programs for the independent members of a Board of Directors in public or private real estate organizations. Board of Director members have varying roles, depending on the circumstances. In public companies, outside members dominate, have a significant role in monitoring and oversight of all aspects of the company and all have roles as members (and likely Chairmanships) on key Committees (Audit, Governance/Nominating, Compensation, Investment, etc.). In private companies, outside Board members may act similarly as in public companies or may have a lesser role as other owners (or family) dominate the membership (and voting) on the Board. A public company’s outside Directors are subject to considerably greater scrutiny and regulations for disclosure and decision rationale. Regardless of the situation, designing appropriate Board of Director compensation requires a full understanding of the dynamics of control and governance as well as the duties, responsibilities and risks associated with Board membership.
CEL is frequently asked to define and make recommendations on the compensation of outside Board members on behalf of shareholders and investors.