Donald Berwick
About Donald M. Berwick
Donald M. Berwick, 78, has served as an independent director of NRC since October 2015. He co-founded and led the Institute for Healthcare Improvement for nearly 20 years and is currently President Emeritus and Senior Fellow; he is also a Lecturer in Health Care Policy at Harvard Medical School. He previously served as Administrator of the Centers for Medicare & Medicaid Services (2010–2011) and held long-standing faculty appointments at Harvard Medical School and the Harvard School of Public Health (1974–2010) .
Past Roles
| Organization | Role | Tenure | Committees/Impact |
|---|---|---|---|
| Institute for Healthcare Improvement | Co-Founder; President & CEO; now President Emeritus & Senior Fellow | ~20 years as CEO; ongoing emeritus/senior fellow | Led national quality improvement; healthcare delivery expertise |
| Centers for Medicare & Medicaid Services (CMS) | Administrator | Jul 2010–Dec 2011 | Federal program leadership; policy execution |
| Harvard Medical School; Harvard School of Public Health | Faculty | 1974–2010 | Academic leadership and healthcare policy scholarship |
| U.S. Preventive Services Task Force | Vice Chair | 1990–1995 | Evidence-based preventive care standards |
| American Hospital Association | First “Independent Member” of Board of Trustees | 1996–1999 | Governance of hospital trade association |
| Agency for Healthcare Research and Quality | Chair, National Advisory Council | 1995–1999 | Research and quality advisory leadership |
External Roles
| Organization | Role | Tenure | Notes |
|---|---|---|---|
| Harvard Medical School | Lecturer, Dept. of Health Care Policy | Current | Academic appointment |
| Institute for Healthcare Improvement | President Emeritus & Senior Fellow | Current | Non-profit leadership role |
Board Governance
| Attribute | Detail |
|---|---|
| Independence | Board determined Berwick is independent under NASDAQ rules |
| Tenure | Director since Oct 2015 |
| Committees | Audit Committee (member); Compensation & Talent Committee (member); Nominating Committee (Chair); Strategic Planning Committee (member) |
| Meeting Attendance | All incumbent directors attended ≥75% of aggregate Board/committee meetings in 2024 |
| Annual Meeting Attendance | Each director attended the 2024 annual meeting |
| Board/Committee Activity | Board held 6 meetings and 1 independent directors meeting in 2024; Audit Committee 6; Compensation Committee 2; Nominating Committee 1; Strategic Planning Committee did not meet |
| Board Leadership | Lead Director: John N. Nunnelly since 2012; CEO/Chair separation to occur upon Trent Green’s appointment (CEO effective Jun 1, 2025; Hays to transition to Chairman) |
Fixed Compensation
| Component | 2024 Amount | Notes |
|---|---|---|
| Fees Earned or Paid in Cash | $75,000 | Includes $25,000 earned portion of contingent Director Cash Payment; standard annual fixed fee for non-executive directors is $50,000; lead director $75,000 |
| Option Awards (grant-date fair value) | $100,008 | Annual director option grant; exercise price at fair market value on grant date; vests the day immediately preceding the next Annual Meeting |
| Total | $175,008 | Summation of cash and options |
| Structure Details (Boardwide) | Cash: up to $50,000 contingent on participation in each of two in-person meetings (two $25,000 increments); Equity: contingent $50,000 “Director Equity Award” (attendance-based) plus annual option grant ~$100,000; lead director annual fixed fee $75,000; other directors $50,000 |
Performance Compensation
| Instrument/Metric | Terms | 2024 Outcome |
|---|---|---|
| “Director Cash Payment” | Up to $50,000 cash (two $25,000 increments) contingent on participating in each of two in-person meetings | $25,000 earned (one increment), included in $75,000 cash fees |
| “Director Equity Award” | Attendance-contingent option award with target grant-date fair value ~$50,000 | No shares earned for the Director Equity Award |
| Annual Director Option | Time-based; grant at Annual Meeting; exercise price = fair market value; vesting immediately before next Annual Meeting | Granted at $100,008 fair value |
Other Directorships & Interlocks
| Category | Detail |
|---|---|
| Current Public Company Boards | None disclosed for Berwick |
| Compensation Committee Interlocks | None; no related person transactions for members in 2024 |
| Related Party Transactions | Company reported none in 2024; policy requires Audit Committee review/approval |
Expertise & Qualifications
- Deep healthcare delivery, policy, and quality improvement expertise; former CMS Administrator and long-tenured academic leader .
- Serves as Nominating Committee Chair, indicating board refresh/skills governance engagement .
- Audit Committee membership underscores governance and oversight experience (financial expert designated is Nunnelly) .
Equity Ownership
| Holder | Shares Beneficially Owned | % of Shares Outstanding | Composition/Notes |
|---|---|---|---|
| Donald M. Berwick | 51,659 | <1% | Includes shares underlying options currently exercisable or exercisable within 60 days of March 20, 2025; options outstanding: 51,659 |
- Vested vs Unvested: Beneficial ownership reflects only options exercisable within 60 days (vested) .
- Pledging/Hedging: No disclosure of pledging; Company does not have policies restricting hedging transactions by directors or officers (explicitly states no practices/policies on hedging), which is a governance concern .
Compensation Committee Analysis
| Attribute | Detail |
|---|---|
| Committee Composition | Chair: Stephen H. Lockhart; Members: Donald M. Berwick, Parul Bhandari, John N. Nunnelly, Penny A. Wheeler (all independent) |
| Use of Consultants | None engaged for 2024 executive compensation; last engagement of a nationally recognized consultant was in 2015 |
| Peer Group | No peer group used due to absence of publicly traded peers |
| Say-on-Pay Outcome (2024) | >98% approval of NEO compensation |
Governance Assessment
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Strengths:
- Independent director with nationally recognized healthcare policy and quality credentials; long tenure and leadership in non-profit and government roles bolster sector insight .
- High engagement markers: Nominating Committee Chair; membership on Audit and Compensation committees; attended ≥75% of meetings and the annual meeting .
- Compensation structures for directors include equity options aligning pay with shareholder outcomes; robust clawback policy covers incentive pay and misconduct/restatements .
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Concerns / RED FLAGS:
- No anti-hedging policy for directors or officers (Company states it does not have practices or policies restricting hedging), which can weaken alignment with shareholders and is contrary to prevailing governance best practices .
- Strategic Planning Committee did not meet in 2024 despite existing charter—could signal limited formal strategic oversight cadence at committee level .
- Ownership alignment appears primarily via options; no direct share ownership disclosed for Berwick, and total ownership is <1%, which may limit “skin in the game” .
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Overall: Berwick’s healthcare governance, policy, and quality improvement background strengthens board effectiveness in NRC’s core vertical. Attention to formal hedging restrictions and increasing direct share ownership over time would improve alignment and investor confidence .
