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Sands outlined four priorities for compensation committees in 2026.
1. Anchor pay to strategy and talent expectations
“From a total rewards perspective, I believe the role of a compensation committee is to make sure that the strategies reinforce the organizational strategies,” Sands said.
Compensation programs should drive long term value creation while also reflecting what today’s workforce expects. As she put it, “The new wave of talent has a different expectation than 20 to 25 years ago.”
For directors, that means ensuring pay structures not only satisfy shareholders and regulators but also attract and retain the talent needed to execute strategy.
2. Balance data with judgment
Formulas, metrics, and compensation philosophies create discipline. But they cannot replace thoughtful oversight.
“It’s incumbent on us to make sure that we are balancing objectivity with judgment,” Sands said. “You can’t take the judgment out of the conversation within the comp committee.”
In practice, that means revisiting legacy frameworks and asking whether they still make sense in today’s environment rather than relying on precedent alone.
3. Be proactive and eliminate surprises
Many compensation committees, Sands observed, feel like they are keeping up rather than getting ahead.
“A lot of times, the committees would say, ‘I just feel like we’re just staying with the organization rather than helping them plan for the future.’”
Her advice is to set clear goals for the year, align early with management, and maintain open dialogue before formal recommendations reach the boardroom.
“At no point should committee members be surprised by the recommendations that they are seeing,” she said. Sharing ideas early, even when they are not fully formed, builds trust and partnership.
4. Look beyond the C-Suite
While CEO compensation is the mandate of the board, Sands says directors cannot ignore what is happening deeper in the organization. “Compensation trends in the organization affect C-suite decisions and even top pay packages.”
Sands pointed to the expansion of long-term cash incentives, once largely reserved for executives, nowsenior leadership and even high- extending into earning individual contributors as companies compete for top talent. She also highlighted the growing importance of flexible and hybrid work arrangements, which can significantly influence attraction and retention in certain markets.
Her advice is for committees to stay curious. Ask questions. Seek external perspectives when appropriate. Understand how workforce trends affect retention, operating costs, and financial performance across the enterprise.
In 2026, compensation oversight cannot be passive. Directors who anchor pay to strategy, apply disciplined judgment, operate proactively, and stay informed about market dynamics will be better positioned to maintain shareholder confidence and retain the leadership talent their organizations need.
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