We hear the cries every day. “Executives make too much money. Let’s raise their taxes!” “Executives are our job creators. Let’s cut their taxes!” Perhaps key members of both sides of this argument are keeping the focus on compensation levels to deflect from where taxes and political contributions come from. Are there underlying reasons for...
As children, we play Follow the Leader with the goal of fitting in. In this game, kids will do whatever the person in front of them does. I have actually seen kids fall down, just because the person in front of them tripped and fell. As adults, we learn that to be a leader, you...
Even with the explosion in performance-based equity, most equity compensation plans look very much like they did almost twenty years ago. Stock options, restricted stock unit and employee stock purchase plans would be familiar to a time-traveler from 1995. The biggest differences are in the size of the payouts and that many participants receive equity...
Executive compensation holds as much mystery and magic as the Great Wizard of the Emerald City. Of course, if the curtain were to be pulled back, the real magic would be found in how a lack of information, combined with fear and imagination, have colored the pay of all executives with the same brush. Remember...
What does “compensation” mean? Those of us who work as compensation professionals consider it a positive, professional word that speaks to people getting paid for services, effort or performance. Like many words, compensation actually means something else entirely. From the Collins World English Dictionary 1. the act or process of making amends for something
How does compensation interact with reputation? Let me count the millions of ways. The calculus of reputational damage can be more intertwined than we account for in our current severance agreements. Recent news articles have discussed comments by Yahoo’s departing CEO, Carol Bartz. Famously, or infamously, she declared in a media interview that she disagreed...
I am sure that when some people saw this title, their first thought was of the mighty compensation professional standing above the fray, bullwhip in hand, directing executives and employees to do what is required to ensure their company success. But let’s be realistic, that’s probably not going to happen. More importantly, in this case...
San Francisco has lots of tall buildings, so we need those cool ladder fire trucks that you see in the cartoons. There is a firefighter in the front seat and another with a steering wheel in the back. As one drove by on an emergency call my nephew asked me who was in charge steering...
So often we see companies whose executives are paid handsomely only to falter shortly after. How does this happen? Goals were apparently met. Success seemed to have been achieved. But the final result of the goals and success is a large payout followed by a sharp corporate collapse. Are we doing something wrong when we...
This article originally appeared on Robin A. Ferracone’s “Executive Pay Watch” blog on Forbes.com. “For today’s Executive Pay Watch blog, I have asked Dan Walter, President and CEO of Performensation and founder of Equity Compensation Experts to weigh in on pay transparency.” Executive compensation is justifiably complex. In fact, the total compensation for nearly everyone...
