Compensation Services - Peer Benchmarking
A solid understanding of the competitive landscape is critical to ensuring an effective compensation strategy. The best way to equip your compensation committee and senior management with this understanding is through a periodic analysis of the pay practices at a carefully selected group of peer companies.
In addition to learning the competitiveness of your total compensation offerings, you will gain an understanding of how your approach to compensating directors and executives differs from your peers. The purpose of a peer analysis is not to conform to the masses, but rather, to help solidify your company’s convictions regarding the direction of its compensation strategy and make appropriate adjustments when necessary. A thorough peer review allows your leadership to ask and answer important questions:
- Are we an outlier in either the amount or forms of total compensation offered to our key leaders? And if so, is it on purpose?
- How does our internal equity among our executives (directors) compare to our peers?
- How does our compensation risk profile compare?
- Are there “best practice” trends that we need to evaluate further?
- Do we have a clear understanding of ALL forms of compensation that we offer our executives and directors? Have we conducted a thorough “tally sheet” analysis?
- Are there ways we can/should improve upon our current approach?