As the Compensation Committee takes on increasing responsibility for overseeing company compensation plans, pay governance, and human capital policies, the selection of a compensation consultant is of paramount importance. In response, HR Policy’s Center On Executive Compensation published a thought leadership piece to help CHROs navigate the selection process for an independent compensation consultant.
The CHRO’s Guide to Selecting an Independent Compensation Consultant. Co-authored by the Center’s Ani Huang, President and CEO and Rich Floersch, Senior Strategic Advisor, the Guide is based on interviews with 13 world-class Compensation Committee Chairs, CHROs, and compensation consultants across multiple sectors. The Guide is a curated collection of insights, tips, and tools for successfully working through the selection process. This valuable resource explores the factors that often trigger a consultant search as well as tips for ensuring a well-orchestrated evaluation process and advice on gaining alignment on key evaluation criteria.
Sample Templates. The Guide includes tools such as a sample compensation consultant RFP, sample questions for reference checking, and a compensation consultant performance evaluation.
Related Webinar on RFP Practices. The Center also hosted a webinar on May 31 featuring Tracy Keogh, Chief People Officer and Growth Partner at Great Hill Partners and Blair Jones, Managing Director at Semler Brossy Consulting Group, who were interviewed for the Guide. We reviewed findings from our recent Center survey on Compensation Consultant Practices and discussed practical ideas for how the CHRO and Compensation Committee Chair can collaborate to ensure the search process is efficientand effective, and results in finding a consultant who works as a collaborative partner with both the committee and management. Ms. Jones recommended that the CHRO clarify the Chair’s expectations of the consultant’s role and their desired working style. Together, they can prioritize the attributes that are most important to the organization. These top priorities can help shape the specific questions that are asked during the evaluation process and better assess the consultant’s fit for the organization’s needs.
Consultant Performance Evaluation. The panelists shared their suggestions for providing performance feedback to consultants and Ms. Keogh emphasized the importance of ongoing feedback. As CHRO, she held debriefs after each committee meeting and the Chair also provided formal feedback on an annual basis.
Onboarding New Consultants. Ms. Jones outlined helpful steps for onboarding new consultants which included providing three years of committee book content, in-person working sessions with the CHRO and Chair to ask questions and gain insights into the committee dynamics, as well as private meetings with stakeholders. Ms. Keogh indicated that interviews with business leaders have been extremely helpful for sharing context and to understand the history of how compensation has been perceived.
The Guide is available to all HR Policy Association members on our website here. We hope it is a useful framework for a rapidly developing area, and we look forward to your comments and input.
