The compensation committee is usually formed to determine the compensation and benefits of directors and executives.
Structure: The committee should be composed of all independent directors who rotate periodically.
Responsibilities: committees have a set of responsibilities which they need to follow stricktly.
Proxy Statement Disclosure: The committee is directly responsible for ensuring that all aspects of executive compensation are fully and fairly disclosed in in the annual proxy statement.
Evaluation of directors.
Design and implementation of director compensation plans.
Evaluation of senior executives.