Recently a lawyer mentioned to me that he had decided to utilize more basic executive plan designs, even when they might not be as good a fit for a specific client. When asked to explain he said that it was too hard to communicate complex plan designs when board members and shareholders demanded something they...
Executive compensation is always in the spotlight. The pay levels for the highest paid executive can truly be astounding to “regular” people. In truth, they are often astounding to executive compensation professionals, including the consultants who make the recommendations. In general, most pay packages can be justified as being competitive in the market, or a...
The pay ratios between CEOs and average employees are once again in the news. This is partly because proxy season always raises this issue and partly because there is a move in some circles to do away with the new pay ratio disclose rule that is part of Dodd-Frank. This year’s ratios will likely be...
We have all seen the headlines, “XYZ receives $100M in funding at a $3B valuation.” We seldom see the “other” valuation showing the same company is worth $350M. For publicly-traded companies, value is determined by investors working as a group in a real-time market. They are generally purchasing the same kind of stock. Values are...
Figuring out the right amount of equity compensation at startups is a challenge. How much should I grant? How big should the grant be? How should I size the grant relative to base pay? Investors, boards, executives, HR and compensation departments at start-ups have conflicts over these questions all the time. In the past I...
Well, so much for the warm-hearted caffeinated, pick-me-up from the Comp Café. Today is a steaming jolt of quadruple espresso in response to the Wells Fargo incentive pay mess. Let me start with the fact that I have been interviewed a few times about this story and even I was surprised by my response to...
A friend of mine likes to say: “It’s not that incentive pay doesn’t work well, it’s that it works TOO well. It usually does exactly what it is designed to do, even if that wasn’t your intent.” Wells Fargo just paid $185M in fines and penalties because its employees fraudulently opened additional accounting for people...
Apple’s stock price is somewhere around $108 today. Over the past five years it has been anywhere from $50 to $132. Medpace was the most recent Initial Public Offering (IPO) on NASDAQ. Thursday, August 11, 2016 their IPO price was $23. By Friday, August 12, the price was above $28 by close of the market....
