Musk’s $56 billion: Pay, Incentives, or Rewards?

By Jeffrey L. Coles, Naveen D. Daniel and Lalitha Naveen October 11, 2024 by renholding

A great deal of space has been devoted by the media to discussions relating to the pay of Elon Musk, CEO of Tesla. The media outrage centers around his 2018 pay package, with many of the headlines reporting a whopping …

How Restructuring Employee Compensation at Boeing Could Improve Airline Safety

By Hamid Mehran June 12, 2024 by renholding

Five years ago, 346 people tragically died in two separate crashes of Boeing’s 737 MAX airplanes. Both crashes were due to seriously flawed design features and inadequate training for pilots. More recently, a harrowing incident occurred when a plug door …

What NCAA Football Teaches Us About the Connection Between Executive Pay and Performance

By Yuri Hupka, Jacqueline L. Garner, Betty J. Simkins and Phillip Humphrey October 20, 2022 by renholding

Our paper utilizes National Collegiate Athletic Association (NCAA) Football Bowl Subdivision (FBS) coaching contracts as a managerial setting to examine whether higher top-managerial pay (our Gridiron CEOs) is associated with better team performance. Coaching contracts are quite compelling as they …

Exequity Offers a Framework for Discretion in Executive Incentive Plans

By Chad Mitchell April 15, 2020 by renholding

The impact of COVID-19 on business has been profound and sudden. Strategic plans, business forecasts, and operating budgets set before the current crisis are likely to bear no semblance to plans that might be set today. Moreover, plans set today …

Exequity Discusses How COVID-19 Is Affecting Pay

By Ben Burney and Chris Wood April 7, 2020 by renholding

While it is safe to say every economic crisis is different, it does not seem fair to compare this crisis to any other. The global impact of the COVID-19 pandemic is unprecedented in modern times. In response, governments around the …

Does Missing Performance Goals Prompt More Opportunistic Insider Trading?

By Meng Gao December 20, 2019 by renholding

Tying executive pay to corporate performance has become increasingly important in creating incentives for corporate managers. Theoretical models argue that compensation contracts that reward managers contingent on performance, especially performance relative to peer firms, can increase managerial effort (e.g., Holmstrom, …

ISS Discusses Trends in 2019 U.S. Executive Compensation

By John Roe and Kosmas Papadopoulos April 16, 2019 by renholding

As we enter the peak of proxy season, we review executive compensation trends in the U.S. based executive pay disclosures so far this year. Our key findings include:

Compensation disclosures so far suggest continued increases in CEO pay across all

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Rising Executive Pay Tied to Uncertainty of Joining New Firms

By Mary Ellen Carter, Francesca Franco and A. Irem Tuna February 22, 2019 by renholding

Everyone knows executive pay is rising. None of us can agree about why. Our forthcoming study in The Accounting Review, “Matching Premiums in the Executive Labor Market,” points to one reason—executives are being compensated for the risk they bear …

How Equitable Pay Can Affect Firm Performance

By Hamilton Elkins July 31, 2018 by renholding

Much of the discourse on income inequality between ordinary workers and top executives concentrates on a ratio of chief executive officer (CEO) compensation to average employee compensation. The business strategy, organizational structure, and size of a firm can influence the …

SEC’s Jackson Calls for Curbing Executives’ Ability to Cash Out on Buybacks

By Robert J. Jackson, Jr. June 12, 2018 by renholding

Thank you so much, Neera [Tanden], for that very kind introduction. I’ve long admired all that you and everyone here at the Center for American Progress do to promote a progressive economic agenda. And I share your commitment to making

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Corporate Governance that Works for Everyone

By Barnali Choudhury and Martin Petrin February 15, 2018 by renholding

Corporate governance has traditionally been viewed as a way to reduce agency costs between shareholders and managers in the context of private ordering. Laws and regulations pertaining to corporate governance have, therefore, typically aimed to enhance long-term wealth for shareholders.…

Why Small Firms Peg Executive Compensation to Rivals’ Higher Pay

By Thomas Ian Schneider November 3, 2017 by renholding

In recent years, executive compensation in the U.S. has become a hotly debated issue. A central point of contention is peer benchmarking, an integral part of the pay-setting process in which firms compare their executives’ compensation with that of rivals …

Tax Gross-Ups May Gross Out Investors

By Jeffrey L. Hoopes, Xiaoli (Shaolee) Tian and Ryan J. Wilson February 8, 2017 by renholding

Much of the public has long believed that executives are overcompensated, a sentiment that has occasionally crept into legislation. In one case, Congress voted to impose punitive excise taxes on managers who received excessive golden parachute payments. Unlike most taxes …

Latham & Watkins discusses How to Navigate the SEC’s Proposed Mandate on Clawbacks

By William Baker III, Jim Barrall, Joel Trotter, Alice Chung, Jonathan Drory and Hayley Gladstone August 7, 2015 by ilyabeylin

Under the long-awaited proposed rules adopted by the Securities and Exchange Commission on July 1, 2015, generally, all US publicly listed companies would be required to adopt broad clawback policies and make new clawback-related disclosures. Although these requirements likely will …

Jones Day discusses SEC’s Proposed Pay Versus Performance Disclosure Requirements

By Robert T. Clarkson, Stephen P. Coolbaugh, Thomas C. Daniels, Wendy Davis, Charles T. Haag, James E. O'Bannon, Robert A. Profusek and Kimberly J. Pustulka June 9, 2015 by AJ

On April 29, 2015, the SEC issued a proposing release regarding the so-called “pay versus performance” disclosure mandated by Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The proposed rules would require certain companies registered under …

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Columbia Law School's Blog on Corporations and the Capital Markets

executive pay