Executive Compensation related to Enterprise Risk

A key driver of performance of Executive Compensation related to Enterprise Risk is the methodology used to calculate compensation terms in context of the risk associated with outcomes. The design of compensation and consideration of all the relevant variables associated with enterprise risk will increase the level of transparency and reduce potentially opaque areas of decision support.

 

The types of metrics used by Arcus can be categorized onto three areas:

  • Cash flow based performance
  • Accrual accounting benchmarks
  • Market driven performance benchmarks

 

A key driver of Arcus’s work with clients relates to the identification and mitigation of risks associated with compensation. We believe that compensation packages can be a powerful tool to drive change and mange enterprise risk. This approach ensures that the priorities of the CEO are aligned with the strategic plan and priorities of the board of directors.

 

The quality of benchmarks and metrics deployed can have a systemic and material impact on the desired outcomes. The methodology also includes schedules of meetings and a checklist of information requirements for each quarter or regular intervals during the assessed period.

 

Arcus offers services in all the key areas that impact executive and organization compensation:

 

Board advisory

  • Board of Directors advisory services
  • Executive compensation audits for Boards

Compensation Design

  • Enterprise Risk Management
  • Market Benchmarked Executive Compensation Strategy

Incentive planning

  • Incentive plan development
  • Compensation disclosure planning
  • Market Benchmarked Board compensation design
  • Expert witness consulting Services