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CEOs can sell stock, they just have to do it on a set schedule. So yes, it's good to incentivize their performance based on how the company performs, but it's n
by Erik816 7y ago
CEOs can sell stock, they just have to do it on a set schedule. So yes, it's good to incentivize their performance based on how the company performs, but it's not like it's pretend money they can't use. It's a real asset and should be considered part of their compensation.
- tathougies 7y agoBut the valuation should not be done at market value, because the CEO cannot realistically use that value without causing his own job to be in contention. If the CEO of disney sold stock (and it would have to be reported), everyone else would too, lowering the price of disney stock (and thus his net worth). Thus, valuing his compensation at $66 mil based on the stock price is wrong for everything but taxation, because realistically, he would get much less in cash if he decided to sell.