The Nominating, Governance & Compensation Committee reviews considerations relating to Board composition, including size of the Board and criteria for membership of the Board of Directors; it identifies, reviews, considers and recommends to the Board qualified candidates to serve as Board members and members of the various Committees of the Board. It further reviews directorships and consulting agreements of Board members for conflicts of interest. In addition, this Committee reviews and recommends Corporate Governance policies and principles for the company, reviews compliance issues, provides support for Corporate Sustainability projects, oversees an evaluation of the Board of Directors, maintains an orientation program for new Board members and an ongoing education program for existing Board members, and makes related recommendations to the Board. Moreover, the Committee makes such recommendations to the Board of Directors as it may consider appropriate and consistent with its purpose, and takes such other actions and performs such services as may be referred to it from time to time by the Board of Directors, including the engagement of any outside advisor it may deem necessary or appropriate, at the company’s expense.
The Nominating, Governance & Compensation Committee further supports the Board of Directors in reviewing and establishing the company’s compensation strategy and policy. It also monitors Board and Executive compensation to ensure that it remains competitive within the applicable law and company compensation schemes. Within this framework, the Committee is responsible for defining the Group’s compensation strategy and principles, designing compensation plans, making proposals for the compensation of members of the Board and the CEO, and approving the compensation of the latter’s direct reports.
The Committee has appointed Alvarez & Marsal (London office) as its independent external advisors to provide guidance on compensation matters.
Board compensation
The Nominating, Governance & Compensation Committee makes proposals for the compensation of the company’s Chairman. In determining these recommendations, the Committee takes account of benchmarking and a review of market practice within companies with a similar market capitalization to Idorsia in Switzerland, carried out by an independent external advisor. The recommendation is approved by the Board of Directors, where all Members of the Board have a right to attend and a right to a say except for the Chairman, who has no right to a say in any decisions regarding his compensation.
The compensation of other non-executive directors is approved by the Board of Directors, where all Members of the Board have a right to attend and a right to a say. In determining these recommendations, the Board of Directors takes account of benchmarking and a review of market practice within companies with a similar market capitalization to Idorsia in Switzerland, carried out by an independent external advisor.
Detailed information is provided in the “Compensation Structure: Board” section of the Compensation Report 2021.
Executive compensation
The CEO’s compensation is approved by the Board of Directors based on the proposal of the Nominating, Governance & Compensation Committee. All members of the Board have a right to attend and a right to a say. The CEO has a right to attend this meeting but has no right to a say. The proposal takes into account both market practice within various groups of companies with which Idorsia competes for talent (as determined by an independent external advisor) and performance against predetermined targets during the relevant year.
The compensation of the CEO’s direct reports is approved by the Nominating, Governance & Compensation Committee based on the CEO’s recommendations. The CEO has a right to attend this meeting but has no right to a say. The CEO’s recommendations take into account both market practice within various groups of companies with which Idorsia competes for talent (as determined by an independent external advisor) and performance against predetermined targets during the relevant year. Targets used to determine payout levels for variable compensation elements such as the short-term incentive plan (STIP) and the long-term incentive plan (LTIP) are set by the Committee on an annual basis, prior to the start of the year in which performance is measured.
Detailed information is provided in the “Compensation Structure: CEO and all other IEC members” section of the Compensation Report 2021.
The Nominating, Governance & Compensation Committee usually meets four times a year. In 2021, it met four times, one time in person and three times by video conference. Each meeting took on average two hours and 15 minutes.
The Chairman may, at his discretion, invite any person to attend the meetings. The CEO regularly attends the meetings, while the independent committee advisors are invited at least once a year to attend portions of the meeting. In 2021, the CEO attended all meetings, while the independent committee advisors participated in three meetings for selected topics.