¶ … Executive Compensation
Sometimes it seems that the salaries executives make at big corporations are entirely out of proportion with the value added to the firm by their being on the payroll. It makes sense that if someone, anyone, makes a certain wage, then they should be making at least that much money for the company. If someone is pumping gas for $7/hr, then he should be pumping at least $7 worth of gas every hour. If someone else is making $30 million/year at a big corporation, then he should be bringing in at least that much revenue, even if only indirectly. If a $30 million/year executive starts programs at the company that make $100million, then the $30million the company pays him is well-worth it. The trouble is that it is sometimes hard to decide the degree to which company performance is the result of an exec's contribution.
If we cannot establish with any degree of certainty the relationship between company success and executives' efforts, one thing we can establish with absolute certainty: if the company tanks, it is upper management that takes the blame. Partly for this reason, executive compensation packages can be ridiculously lucrative; execs get lavishly rewarded for good performance so that, if they are wise with what they have earned, they can survive once their reputations have been ruined by a messy dismissal, such as one-time stock market darling Mel Karmazin, sent packing by Viacom just this year (Kadlec, et al., 2004). I would like to spend...
In order to compare the executive compensation in both countries, the countries firms should be matched and compared according to industry, size and operation. The executive compensation can be measured or compared accurately according to the industry and firms sizes. From the data, it was found that the executive compensation in both countries were high whereas the firm performance was reducing. The data collection for the executive compensation in
Executive Compensation Programs and Incentives In 1996 the average salary plus bonus for CEOs was $2.3 million. After other benefits were added, this sum rose to $5,781,300. Beginning with Revlon executive Michael Bergerac who broke the $1 million mark in 1974, executive pay and bonus plans have soared to mind-boggling proportions. Although various governmental agencies have set limits on tax-deductible executive compensation, these efforts not only failed but served to raise
Part of the reason for this, is because shareholders and the board of directors are allowing this to occur. To prevent the situation from becoming worse, shareholders and the board need to be more independent, by questioning the motives / actions of management. At the same time, there must be some kind regulations in place that can prevent the runaway abuses from occurring. If this kind of strategy can
Out of the previous two CEO's, Apotheker has by far the most experience. What more intriguing is that he has experience with both the entrepreneurial and corporate aspects of business? This provides a competitive advantage for HP as it has further know how in regards to new venture planning. It can also recognize viable new enterprises better as a result of the knowledge gained from Apotheker. Finally, Apotheker has extensive
Compensation is a sub-discipline of Human Resources Management and has become even more critical for organizations in the 21st century. Compensation, of course, is the salary or pay an employee receives from an organization and may fall into four categories: 1) Guaranteed Pay (fixed), 2) Variable Pay (Performance or results based); 3) Benefits (Medical, etc.), and 4) Equity-Based Compensation (Stock or organizational programs). There are many forms of compensation, many
By bringing more locals into the overseas operation, the use of expats can be reduced. In addition, the cost of expats should be factored into the decision to enter a market. Major markets will still be profitable even with the presence of expats, but there are many marginal markets that may not be viable once expat costs are included (for example, where Malaysia may be profitable, adjacent Brunei may
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