If they haven’t already, companies, boards of directors and compensation committees ought to put a process in place for assessing the risk of their executive and employee compensation programs, partners in the law firm Winston & Strawn advise.
A pending Securities and Exchange Commission proposal would require all public companies to evaluate whether any of its compensation plans and practices include risk-taking incentives that may have a material effect on the company and to disclose the results of that evaluation and any steps taken to manage or mitigate those risk-taking incentives.
