Many companies have received or are receiving SEC comments on their 2010 proxy statement disclosures as to their compliance with the compensation risk review requirement. Since last year, I have blogged nearly one dozen times on the SEC risk assessment requirements, which were finalized on December 15, 2009. However, given the shortness of time between the SEC's December publication of the final disclosure rules, many companies scrambled to organize a disclosure in time for their 2010 proxy statements.

Now that compensation committees and executive compensation professionals are gearing up for Dodd-Frank compliance, it would be a great time to improve and institutionalize a process that would fully satisfy the compensation risk review requirement and protect the board members from liability for the review and disclosure - in time for the 2011 proxy statement.

For example, we have worked with compensation consulting firms and companies' in-house legal, HR and executive compensation professionals to (1) organize a team of individuals to conduct the risk review, (2) prepare information requests, and sample disclosures and (3) generally create a process that will satisfy the compensation risk review requirement and earn board members the protection of the Business Judgment Rule.