The compensation committee usually is a subgroup of the board of directors that is composed of directors who are currently the officers of the firm.

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The compensation committee is typically a subgroup of the board of directors, but its members are not necessarily officers of the firm. They may be independent directors, meaning that they have no executive role in the company. The purpose of the compensation committee is to oversee and make recommendations to the board regarding executive compensation packages.

The Compensation Committee Usually Is a Subgroup of the Board