Board Governance Series

Richard Harris, principal and senior consultant, Hewitt Associates, shares tips for compensation committee members such as making sure your incentive plan measures the right things and how to create a well-rounded starting point for incentive plan metrics.

Experts from PricewaterhouseCoopers LLP, FTI Consulting, Hewitt Associates, and Covington & Burling LLP weigh in on whether compensation plans are providing incentives for appropriate corporate behavior.

"Not all companies are susceptible to a Madoff-type fraud...but many companies are susceptible to financial reporting misstatements, some of which might rise to the level of a fraud," says Linda MacDonald, senior managing director, FTI Consulting. She lists the key areas of financial reporting that are most susceptible to fraud and how boards can mitigate that risk.

Mary Ann Polk, principal and senior consultant for Hewitt Associates' Leadership Group, reviews proxy season '09 and looks ahead to proxy season '10. She cautions, "Last year's status quo won't necessarily be next year's status quo."

While changes at the SEC and a downturn in the economy has slowed the adoption of IFRS, it isn't a dead issue. Richard A. Fuchs, partner & IFRS leader, PricewaterhouseCoopers LLP, talks about the impact of IFRS on boards and what boards should do now. "Be prepared. There is a lot of change coming," he warns.

What are pay-to-play laws and how do they work? How can these laws affect directors? Robert K. Kelner, partner and head of the election and political law pratice group, Covington & Burling LLP, reviews pay-to-play laws and the board's role in managing political contribution risk.

In the second part of this two-part discussion on political fundraising, Robert Lenhard, of counsel for the election and political law practice group of Covington & Burling LLP, explains why two fundraising events are of particular concern, who can pay for events, and what boards need to be aware of regarding executive political fundraising.