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Can you elaborate on why they’re “entirely orthogonal?” Since this increased compensation is stock, aren’t they at least somewhat related?
by jdavis703 8y ago
Can you elaborate on why they’re “entirely orthogonal?” Since this increased compensation is stock, aren’t they at least somewhat related?
- whack 8y agoYou can pay someone the exact same target-compensation, while still shifting it away from cash, and towards stock. For example, giving someone a stock grant of 1000 shares of GOOG, instead of paying them $1.1M in cash.
- yowlingcat 8y agoThere are still issues with this approach, although they're a bit more subtle. Think about Valeant circa 2015 -- definitely taking a short term approach of acquiring and stripping pharma companies, which did positively impact their stock price. But, they did it in an unsustainable manner.