what is a compensation draw?

Answer 1

There are several definitions/uses for this. If you work for a company in which part of your income is based on performance bonuses, you can sometimes "draw" (meaning "borrow") from future bonuses. If you have your own company (like an s-corporation), you usually take a "draw" periodically instead of taking a regular salary.

Answer 2

Sometimes commissioned sales people get a draw on their earnings, which is an advance.

Also, owners of companies can take the money they have invested into their company back out in the form of a "draw".