Reading Time: 5 minutes
Compensation committees used to operate like a “scalpel,” focused almost exclusively on CEO pay. In this episode of the Public Company Series Podcast, powered by OnBoard, host Doug Chia sits down with Semler Brossy Managing Directors Blair Jones and Todd Sirras to unpack how compensation committees are evolving to oversee workforce strategy, culture, talent development, and organizational readiness for the future.
Chia frames the shift clearly: “The Compensation Committee has evolved from having its sole focus on how to compensate those in the C-suite to how the company manages its entire workforce.” That expansion forces boards to rethink governance, talent strategy, and how compensation signals culture across the organization.
Jones and Sirras, who authored The Expanding Compensation Committee Mandate chapter in Board Structure and Composition, outline why the mandate broadened, what it means in practice, and how committees can scale up without slipping into micromanagement.
Why the Mandate Expanded in the First Place
Jones describes the evolution as a series of “steps,” each pulling the committee deeper into workforce issues.
First came succession planning. Boards faced criticism for weak internal benches and an overreliance on external hires. As a result, boards started digging into leadership development pipelines, and in many cases “the Compensation Committee became a natural repository to take on that work,” Jones explains.
Next came regulation and disclosure. Jones points to pay equity rules, CEO pay ratio requirements, and broader global disclosures that forced committees to look beyond the executive suite. Those changes raised questions about how pay gets set, what “equitable pay for equitable work” really looks like, and whether the company can defend its compensation philosophy.
Then, stakeholder capitalism pushed culture into the spotlight. Committees started tracking inclusion, engagement, and leadership development because those factors increasingly influenced reputational risk and long-term performance. And now AI is accelerating the change again, as companies rethink org design, workforce planning, and reskilling for “a workforce that will include AI agents,” as Jones puts it.
Sirras adds a simple governance logic test: If compensation represents the company’s investment in its people, then the comp committee is the obvious place to optimize that investment. “Compensation represents a lot more than just dollars that go into someone’s bank account,” he says. It communicates value, priorities, and what the organization rewards.
Board Meeting
Ensure effective, efficient meetings with our comprehensive Board Meeting Agenda Template.
What Boards Need in the Room: Skills, Context, and CHRO Credibility
With the expanded charter comes an expanded need for expertise. Sirras argues boards should build “broad and diverse” capability, including finance, people leadership, performance measurement, emerging technology, and business judgment.
Jones adds that boards should look for leaders who’ve managed talent through disruption. That includes leaders who’ve driven change, navigated labor issues, led global workforces, and handled industry disintermediation, because those contexts test how talent strategy actually works.
A major thread in the episode focuses on the growing value of Chief Human Resources Officers (CHROs) in the boardroom, and the outdated stigma they still face. Chia says CHROs can get dismissed as “HR specialists” rather than enterprise leaders.
Jones pushes back: “CHROs, at the end of the day, their job is to implement strategy. So, understanding the big picture becomes central to that.” She also points out that the last few years forced HR leaders onto the front lines — COVID, the Great Resignation, and now AI-driven redesign — often in ways many directors hadn’t dealt with firsthand.
Sirras agrees the stigma is real: “HR has a history problem. It used to be called personnel… you went there to make sure that your time card was working right.” But he argues strong HR leaders bring rare value because managing people is “extremely complicated and messy,” and the best CHROs learn to navigate the nuances boards increasingly need to understand.
“Compensation can Lead Culture”
Chia flags one of the chapter’s key phrases: “Compensation can Lead Culture.” Sirras explains it as signaling. “The way that you pay people says a lot about the type of company that you are. What you value and what… gets you ahead in our company?” Compensation, especially incentives and performance measures, tells employees what matters, and what will be recognized.
Jones gets even more concrete. She describes how compensation structures can encourage teamwork or individual accountability depending on what the moment requires. In one organization, the CEO drove a “one team, one dream” ethos by using shared measures across levels so the organization “wins and dies together.” In another, the CEO used discrete business unit measures during a turnaround to send a message: deliver results, own your numbers.
Culture Carriers: Rewarding the People Who Make Values Real
Jones defines culture carriers as the people who model the organization’s values in a way others want to follow: “They’re mentoring people. They’re building inclusive environments… a piper that people want to follow.”
And while you can’t simply “pay someone to do culture,” the committee can influence whether culture carriers become visible and rewarded through promotions, leadership roles, and cross-functional initiatives, which often leads to compensation growth as a natural outcome.
Staying Strategic without Micromanaging: Align Goals, Create Healthy Tension
Chia raises a fair concern: If comp committees start asking about how goals cascade and how success gets communicated, does that become “fingers in” governance?
Sirras argues the committee doesn’t have time — or the mandate — to run operations. The point is alignment and context. “Tell us what you’re doing with the company… That will factor into how we think about what the right performance metrics are for the business on the executive team,” he explains. The committee gathers enough understanding to make better compensation decisions, not to dictate how management runs the organization.
Jones shows where this oversight becomes practical:
- Healthcare: When senior leaders don’t measure quality, the committee needs to see how quality metrics flow through business units.
- Cash flow: If employees don’t understand what drives the metric, the committee should ask how leaders train teams and communicate the levers that move it.
- Post-M&A: When acquired businesses run semi-autonomously, the committee should ensure their goals and incentives support the deal’s purpose.
Sirras adds that alignment doesn’t mean everyone gets paid for the same thing. Committees should also understand where the company wants “healthy tension.” He illustrates it with a simple example: sales gets paid to sell widgets; compliance gets paid to keep the company from getting sued. Competing incentives can still serve a single strategy, so long as the company manages them well.
Better Data, Real Voice, and the Crawl-Walk-Run Roadmap
As committees take on human capital governance, Jones suggests they ask for data that reflects strategy, not just “aggregated” dashboards that hide risk. She recommends starting with the populations that truly drive outcomes (nursing, distribution center labor, critical AI talent) and analyzing engagement and retention in ways that reveal what’s actually happening.
The conversation turns to “worker voice” and mentions a standout example: Delta Air Lines’ employee committee that relays concerns and suggestions to executives and the board. Jones doesn’t call it a trend yet, but she does call it “a really promising idea.” She also notes other ways boards get closer to reality:
- Board members attending town halls or small group meetings (sometimes without management present).
- Board dinners that skip levels to include “promising individuals,” seated with relevant directors.
- Engaging employee resource groups as a direct feedback channel.
To make this practical, Jones and Sirras advocate a “crawl, walk, run” model for committees expanding into human capital oversight:
- Crawl: Get familiar with topics and experts, such as benefits, engagement, talent planning, or performance management.
- Walk: Tie human capital priorities to business strategy and request focused reporting on what matters most over the next 1 to 3 years.
- Run: Include business unit leaders, future successors, and retrospectives with the CHRO to reflect on what the company learned and what needs to change.
As Sirras reminds listeners, no matter how far the committee goes, it should keep returning to the charter: expand only in ways that help the committee execute its responsibilities pragmatically, not performatively.
In other words, comp committees can’t stay in a CEO-pay-only world. But they also don’t need to “fly” on day one. With the right skills, smart questions, and a structured approach, they can evolve into the kind of modern governance body today’s workforce and stakeholders already expect.
Free Tool
Navigate board software options wisely using our comprehensive vendor comparison tool
Request a free trial today to see how OnBoard streamlines board management.
About The Author
- Ashley Merder is the Senior Manager of Brand Marketing at OnBoard, where she leads brand strategy, content, social presence, and creative direction. With over a decade of experience working alongside a nonprofit board, she brings a mission-driven perspective to B2B SaaS. Her work focuses on making strategy visible using clarity, discipline, and design to shape how the brand is understood, trusted, and experienced.
Latest entries
Board Management SoftwareMarch 17, 2026Unlocking Value: The High-Stakes of Navigating Corporate Spinoffs
Board Management SoftwareMarch 11, 2026Why the Nominating Committee Holds the Key to Governance
Board Management SoftwareMarch 3, 2026How AI Is Already in Boardrooms and Shaping How Directors Do Their Jobs
Board Management SoftwareFebruary 26, 2026Board Compensation Committees: Can Compensation Lead Culture?
