Bank Compensation Corner: June Insights

Bank Compensation Corner: June Insights

Welcome to this month’s edition of Bank Compensation Corner, where we spotlight key compensation trends and insights that matter most to the banking industry. This month, we’re diving into evolving leadership expectations, CEO pay growth, and how director compensation may influence risk in the boardroom. Each article offers critical insight into the changing dynamics of governance and pay practices, essential reading for compensation committees, HR leaders, and executive teams.

The Evolving Skill Set of a Compensation Committee Chair

As the compensation committee's role becomes more complex, so do the demands on its leadership. This article explores how today’s chairs must understand incentive design and pay governance and serve as communicators, strategists, and risk stewards. For banks with high stakeholder scrutiny and regulatory pressure, having the right skills at the committee's helm is increasingly critical. This is a helpful resource for assessing leadership readiness and board development plans.

2025 Filings Show Robust CEO Pay Increases at U.S. Large Cap Companies

New analysis of 2025 proxy filings reveals strong CEO pay growth, especially in the largest companies. This article outlines median increases, shifts in pay mix, and key performance metrics used in long-term incentive plans. For banks, this data provides valuable context for positioning executive compensation competitively while staying aligned with shareholder expectations. It’s a useful benchmarking tool for evaluating your 2025 compensation decisions.

Skin in the Game: Does Outside Directors’ Equity-Based Compensation Induce or Mitigate Stock Price Crash Risk?

This academic study closely examines equity-based compensation for outside directors and its relationship with firm risk, particularly stock price crashes. While offering equity can strengthen alignment with shareholders, it may also introduce unintended incentives. This research provides a nuanced perspective on how director pay structures can support (or undermine) prudent risk oversight for bank boards.

In an evolving regulatory and economic landscape, staying informed on trends like these is essential to building effective, responsible compensation programs. We’ll continue bringing you practical takeaways and timely monthly updates in Bank Compensation Corner.