William Browning
About William L. Browning
William L. Browning, age 71, has served as an independent Class I director of Ares Commercial Real Estate (ACRE) since February 2014 and currently chairs the Audit Committee and serves on the Compensation Committee. He is a former senior client service partner and Los Angeles office managing partner at Ernst & Young, with earlier partnership and leadership roles at Arthur Andersen; he holds a B.B.A. from the University of Oklahoma and was a certified public accountant in Oklahoma, California, and Texas. His background spans real estate/REITs, financial services, energy, engineering/construction, and technology, and the Board recognizes him as an “audit committee financial expert.”
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Ernst & Young LLP | Senior client service partner; Managing Partner, Los Angeles office | Senior partner 1999–2012; LA Managing Partner 2008–2012 | Led one of E&Y’s largest Americas practices; >1,200 professionals and >$400M annual revenues at departure |
| Arthur Andersen & Co. | Partner; Office Managing Partner (Oklahoma) | Partner 1987; Office Managing Partner 1994 | Led domestic banking and regulatory compliance practices; served clients across multiple industries |
External Roles
| Organization | Role | Status | Notes |
|---|---|---|---|
| McCarthy Holdings | Director | Current | One of the top U.S. commercial builders; also previously on McCarthy Building Companies board |
| Five Point Holdings, LLC | Director | Current | Owner/developer of mixed‑use, master‑planned communities |
| Parsley Energy, Inc. (NYSE) | Director | Former | Company acquired in 2021 by Pioneer Natural Resources |
| Blackbrush Oil and Gas LP | Director | Former | Portfolio company of a fund managed by an affiliate of ACRE’s Manager (Ares) |
| CARE (non‑profit) | Board volunteer | Current | Focused on assisting young adults with chemical abuse issues |
Board Governance
- Committee assignments: Chairperson, Audit Committee; Member, Compensation Committee. The Board deems these committees fully independent under NYSE and SEC rules, and designates Browning and all audit members as “audit committee financial experts.”
- Independence: The Board affirmatively determined Browning is independent under NYSE Rule 303A.02.
- Attendance and engagement: In 2024, the Board met 7 times; Audit 7; Nominating & Governance 4; Compensation 6. Each director attended at least 75% of their Board/committee meetings, and all directors attended the 2024 annual meeting.
- Board leadership and executive sessions: The Lead Independent Director (Caroline E. Blakely) presides over executive sessions; non‑management and independent directors meet regularly without management.
- Outside board service guardrails: Corporate Governance Guidelines require Board review if a director serves on ≥4 public company boards; audit members serving on >3 public audit committees require an explicit Board determination of effectiveness.
Fixed Compensation (Director)
Program structure (independent directors):
- Annual fee $175,000, delivered ~54% in restricted stock and ~46% in cash; equity vests ratably quarterly over one year. Lead Independent Director additional $25,000 cash; Audit Chair additional $20,000 cash; Audit member (non‑chair) $10,000; Compensation/Nominating members $5,000; committee chairs (other than audit) $10,000. Initial 5,000 restricted shares upon joining the Board.
2024 reported compensation (Browning):
| Item | Amount |
|---|---|
| Fees Earned or Paid in Cash ($) | $105,000 |
| Restricted Stock Awards ($) | $95,000 |
| Total ($) | $200,000 |
Performance Compensation (Director Equity)
| Component | Form | Grant/Delivery | Vesting/Terms | Notes |
|---|---|---|---|---|
| Annual equity for directors | Restricted common stock | ~54% of $175,000 annual fee | Ratable quarterly over 1 year | Time‑based; aligns with ongoing service |
| Initial joining grant | Restricted common stock | 5,000 shares at Board entry | As per plan | For outside directors at time of joining |
| Unvested restricted shares (12/31/2024) | Shares outstanding | 6,920 | Per plan | Browning’s unvested balance as of year‑end 2024 |
| Unvested RS/RSUs vesting within 60 days of 3/26/2025 | Shares | 3,460 | Within 60 days | Scheduled vesting window disclosure |
| Dividend equivalents on RSUs | Cash equivalents | When ordinary cash dividends are paid | Follows RSU plan | Applies to RSUs granted to executives; included here for completeness on equity mechanics |
Note: Director equity is time‑based; no performance‑conditioned metrics are disclosed for director awards.
Other Directorships & Interlocks
| Entity | Nature of potential interlock/conflict | Evidence |
|---|---|---|
| Blackbrush Oil and Gas LP | Prior directorship at a portfolio company of a fund managed by an affiliate of ACRE’s Manager (Ares) | Indicates historical network ties to Ares’ ecosystem; prior role (not current) |
Expertise & Qualifications
- Audit and financial expertise: Board‑designated “audit committee financial expert”; former Big Four senior partner and office managing partner; multi‑sector audit experience including REITs.
- Technical/industry depth: Real estate/REITs, financial services (banks, AM, consumer finance, mortgage), energy, engineering/construction, and technology.
- Professional credentials: B.B.A., University of Oklahoma; formerly CPA in OK, CA, and TX.
Equity Ownership
| Metric | Detail |
|---|---|
| Total beneficial ownership (3/26/2025) | 59,916 shares; “<1%” of outstanding (based on 54,856,977 shares) |
| Indirect holdings | Includes 46,074 shares held by The Browning Family Trust (trustee: Mr. Browning) |
| Unvested equity (12/31/2024) | 6,920 unvested restricted shares outstanding |
| Scheduled vesting window | 3,460 unvested restricted shares/RSUs vest within 60 days of 3/26/2025 |
| Ownership guidelines | Directors must hold equity equal to 3x annual cash fees; all directors/executives have met or are on track, subject to grace periods |
| Hedging/pledging | Prohibitions on short‑selling, hedging, and pledging without prior approval under the Insider Trading Policy |
Governance Assessment
-
Strengths
- Financial oversight: As Audit Chair and an SEC‑defined “audit committee financial expert,” Browning enhances the Board’s control environment, overseeing auditor independence, internal controls, and enterprise risk (including cybersecurity, data privacy, and AI‑related risks).
- Independence and attendance: Affirmed independent; the Board/committees had regular cadence in 2024 with all directors meeting ≥75% attendance and full attendance at the 2024 annual meeting.
- Alignment mechanisms: Meaningful equity component (~54% of annual director pay) with ongoing vesting; robust stock ownership guidelines (3x cash fees) with compliance “met or on track.”
-
Potential Risk Factors / RED FLAGS (monitor)
- External manager conflicts: ACRE is externally managed by an Ares affiliate; the Management Agreement pays a 1.5% base fee on stockholders’ equity and reimburses certain costs. While the Audit Committee pre‑approves related‑party transactions and Ares has REIT competition restrictions, external management inherently poses potential conflicts around fees and resource allocation.
- Ecosystem interlocks (historical): Browning previously served on the board of Blackbrush Oil and Gas LP, a portfolio company of an Ares‑affiliate fund, indicating prior network ties to Ares’ platform (though not current).
- Board service load policy: While Browning’s current public/private board count is not flagged, the company’s guidelines require Board determinations for ≥4 public boards and >3 audit committees—an area to monitor for independence bandwidth.
-
Mitigants
- Related‑party controls: Audit Committee reviews and pre‑approves or ratifies related‑party transactions; Corporate Governance Guidelines and a Code of Business Conduct govern conflicts.
- Insider trading safeguards: Prohibitions on hedging, short‑selling, and pledging without prior approval reduce misalignment risk; clawback policy adopted consistent with NYSE Rule 10D.
Fixed Compensation (Program Reference)
| Component | Amount/Terms |
|---|---|
| Annual director fee | $175,000 (~54% restricted stock; ~46% cash); equity vests quarterly over one year |
| Lead Independent Director fee | +$25,000 cash |
| Audit Committee Chair | +$20,000 cash |
| Audit Committee Member (non‑chair) | +$10,000 cash |
| Compensation/Nominating Chair | +$10,000 cash |
| Compensation/Nominating Member (non‑chair) | +$5,000 cash |
| Initial equity on joining Board | 5,000 restricted shares |
Other Directorships & Interlocks (Summary Table)
| Company/Organization | Type | Role | Status |
|---|---|---|---|
| McCarthy Holdings | Private | Director | Current |
| Five Point Holdings, LLC | Real estate | Director | Current |
| Parsley Energy, Inc. | Public (NYSE) | Director | Former; acquired by PXD in 2021 |
| Blackbrush Oil and Gas LP | Energy (Ares‑affiliated fund portfolio) | Director | Former |
| CARE (non‑profit) | Non‑profit | Board volunteer | Current |
Notes on Say‑on‑Pay and Shareholder Feedback (Context)
- The company conducts ongoing stockholder outreach and has recently implemented governance enhancements including stock ownership guidelines, hedging/pledging restrictions, a director majority vote policy, and a clawback policy consistent with NYSE rules. A large majority supported director elections at the 2024 annual meeting.
Overall, Browning’s audit leadership, independence, and accounting depth support board effectiveness; investors should continue monitoring external manager dynamics and any evolving interlocks with Ares‑affiliated entities as part of ongoing governance risk assessment.