Clarke was appointed in June 2012 after Roy Hodgson departed to take charge of England, and led West Brom to eighth in the Premier League last season.
The Scot's deal at The Hawthorns expires at the end of the current campaign, but the Midlands outfit have revealed they will aim to clarify Clarke's future at the beginning of 2014.
"Steve's contract situation was discussed at last month's board meeting," West Brom's sporting and technical director Richard Garlick said in a statement.
"We decided that we would open talks with Steve in the New Year which, historically, we feel is the appropriate time to address such matters.
"We have got an extremely busy period ahead, with important games coming thick and fast.
"Once the Christmas period is out of the way, we plan to sit down with Steve and discuss his future.
"Steve is aware of our plans and has told us he is comfortable with the situation."
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