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That would be trivially gamed by either requiring more compensation up front or the CEO simply behaving against the interests of the company during hard times.
by 1123581321 4y ago
That would be trivially gamed by either requiring more compensation up front or the CEO simply behaving against the interests of the company during hard times.
- CoolGuySteve 4y agoCEOs currently get paid either way, either by golden parachutes and retention bonuses when the company fails or by big paydays when the company grows. It's in the best interest of the shareholders that the CEO of a failing company either have faith that it will turn around or negotiate an acquisition. I don't believe this is the case with current executive compensation structures. And at least this penalty would be an incentive towards shrinking the company via attrition instead of disrupting the lives of thousands of employees and shocking the labour market.
- 1123581321 4y agoI understand your sentiment and I agree that a slow trickle of attrition, if executed well and not coupled with an overly conservative hiring rate, would be one of the better side effects of your proposal.
- Retric 4y agoCEO’s don’t have infinite leverage to negotiate compensation.