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Committee Charters - Compensation
Audit | Compensation | Nominating
CHARTER OF THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS OF
INVESTMENT TECHNOLOGY GROUP, INC.
Purpose
The Compensation Committee is appointed by the Board of Directors to discharge the Board's responsibilities relating to compensation of the Company's directors and executive officers. The Compensation Committee has overall responsibility for approving and evaluating the director and executive officer compensation plans, policies and programs of the Company.
The Compensation Committee is also responsible for producing an annual report on executive compensation for inclusion in the Company's proxy statement in accordance with applicable law, rules and regulations.
Committee Membership
The Compensation Committee shall consist of no fewer than three members and each member shall be a member of the Board. Each of the members of the Compensation Committee shall meet the independence requirements of the New York Stock Exchange and any other legal requirements for the proper administration of the Company’s compensation plans and programs, including requirements under the Federal securities laws and the Internal Revenue Code of 1986, as amended.
The members of the Compensation Committee shall be appointed by the Board on the recommendation of the Nominating & Corporate Governance Committee. Compensation Committee members may be removed and replaced by the Board.
Committee Authority and Responsibilities
1. The Compensation Committee shall have the sole authority to retain and terminate any compensation consultant to be used to assist in the evaluation of director, CEO and executive compensation and shall have sole authority to approve the consultant's fees and other retention terms. The Compensation Committee also shall have authority to obtain advice and assistance from internal or external legal, accounting or other advisors as it determines necessary to carry out its duties.
2. The Compensation Committee shall at least annually review and approve corporate goals and objectives relevant to CEO compensation, evaluate the CEO's performance in light of those goals and objectives, report the results of such evaluation to the Board and set the CEO's compensation levels based on this evaluation. In determining the long term incentive component of CEO compensation, the Compensation Committee will consider the Company's performance and relative shareholder return, the value of similar incentive awards to CEOs at comparable companies, the awards given to the CEO in past years and such other matters as it deems relevant.
3. The Compensation Committee shall annually review and make recommendations to the Board with respect to the compensation of all executive officers (and, with respect to directors, periodically), including incentive compensation plans and equity based plans and oversee the administration of these plans and discharge any responsibilities imposed on the Compensation Committee by any of these plans.
4. The Compensation Committee shall annually review and approve, for the CEO and the executive officers of the Company, (a) the annual base salary level, (b) the annual incentive opportunity level, (c) the long term incentive opportunity level, (d) employment agreements, severance arrangements, and change in control agreements/provisions, in each case, as, when and if appropriate, and (e) any special or supplemental benefits, all in accordance with applicable law, rules and regulations.
5. To the extent appropriate or necessary to comply with any federal securities or tax law requirements, such as Rule 16b-3 of the Securities Exchange Act of 1934, as amended, or Section 162(m) of the Internal Revenue Code of 1986, as amended, the Compensation Committee shall exercise the exclusive authority to approve or ratify elements of compensation of executive officers as and when such authority is delegated to the Compensation Committee by the Board.
6. The Compensation Committee may form and delegate its authority to subcommittees when appropriate.
7. The Compensation Committee shall make regular reports to the Board.
8. The Compensation Committee shall review and reassess the adequacy of this Charter annually and recommend any proposed changes to the Board for approval.
9. The Compensation Committee shall annually review its own performance.
10. The Compensation Committee shall have such other authority and responsibilities as may be assigned to it from time to time by the Board.
11. The Compensation Committee shall establish the Company’s general compensation philosophy, and, in consultation with senior management, oversee the development and implementation of compensation programs.
Adopted by the Board of Directors on March 26, 2007.