Restarting Business During COVID-19

“Reopening is a bit of a misnomer. It is very difficult to predict what is going to happen, and categorical statements should be met with skepticism." – Troy Brennan, Executive Vice President and Chief Medical Officer, CVS Health

As some parts of the United States move through the phases of reopening, the data present a troubling picture with rising infection rates afflicting states ranging from Georgia and Florida on the East Coast to Texas, Arizona, and California across the country. Throughout the pandemic, political leaders and policy makers have presented vague, and even conflicting, guidance. Guidelines and regulations for businesses have shifted frequently and in some instances have actually been absent. This exacerbates one of the phenomena that business most abhors—uncertainty.

Over the course of two weeks, NACD, along with its partners Farient Advisors; Heidrick & Struggles; KPMG; PwC; Sidley Austin LLP; and Weil, Gotshal & Manges LLP, convened the four Fortune 500 Committee Chair Advisory Councils for a series of virtual meeting discussions on the current strategies and board oversight of restarting businesses. In one session, Advisory Council delegates were joined by Troy Brennan, executive vice president and chief medical officer of CVS Health, who provided an update on the current status of COVID-19 testing, vaccine development, and practices and protocols for a safe work environment. In another session, Michael Beaty, KPMG’s Healthcare Solutions leader, joined and shared a risk framework for restarting.

The focus on the board’s compensation committee has never been sharper. The components of compensation plans and the link between compensation and company performance are under intense scrutiny from shareholders, employees, policymakers, the media, and other stakeholders. The Report of the NACD Blue Ribbon Commission on the Compensation Committee revisits NACD’s 2003 Report of the NACD Blue Ribbon Commission on Executive Compensation to highlight the new environment in which compensation committees—and, more broadly, boards—are now operating. It recommends that the compensation committee and board work together to establish an executive compensation philosophy that supports the company in creating long-term, sustainable value.

The report includes ten specific recommendations for compensation committees to consider when evaluating their compensation philosophies. It also provides practical tools, such as sample compensation committee charters, a compensation committee assessment, and guidance on executive employment contracts.