Future of HR “The Future CHRO’s Guide to Executive Compensation” with Ani Huang, President of Policy and Practice at the CHRO Association and Charlie Tharp, Senior Advisor for Research & Practice at the CHRO Association and the Center On Executive Compensation
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Dec 9, 2025 Ani Huang, President of Policy and Practice at the CHRO Association, and Charlie Tharp, Senior Advisor at the same organization, explore the vital role of executive compensation in shaping company culture and performance. They discuss how compensation serves as a strategic communication tool and impacts employee perceptions of fairness. The conversation delves into aligning pay with business strategy, the evolution of compensation practices, and the importance of transparency. They emphasize that understanding metrics and developing deep business acumen are crucial for CHROs.
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Compensation As Strategic Communication
- Executive compensation is a strategic communication tool that signals priorities, culture, and long-term value.
- Charlie Tharp says compensation design (metrics and forms) tells investors, employees, and regulators what the company values.
Homogenization From Proxy Pressure
- Proxy advisors and shareholder scrutiny pushed companies toward homogenized, equity-based three-year performance plans.
- Charlie Tharp warns this external pressure reduces tailored pay designs that fit company strategy.
Short-Term Awards Build Long-Term Value
- Senior executives' decisions have long-term impact, so their pay skews heavily to long-term incentives.
- Short-term operational metrics should align tightly with long-term value because annual results sum into long-term outcomes.