News and Events for Attorneys and Executives

Linking Nonfinancial Metrics to Strategy and Culture

National Association of Corporate DirectorsThe National Association of Corporate Directors recently convened a meeting of Fortune 500 audit and compensation committee chairs to discuss the key issues and challenges the board faces in the selection and use of nonfinancial metrics. A free report on the results of that meeting is available from NACD.

Three key takeaways emerged from the meeting.

  • Boards should link nonfinancial metrics to strategic and cultural objectives.
  • Audit committees should leverage internal audits to meet the challenge of nonfinancial data quality oversight.
  • Compensation committees are focusing on the role nonfinancial metrics play in compensation-plan design and in eventual payouts.

The full report from the meeting includes:

  • key questions for boards to ask about nonfinancial metrics
  • the four critical roles for internal audit in support of governance over nonfinancial reporting
  • special considerations for the compensation committee

Download the report.