April 1, 2007 Executive Compensation Executive & Director Pay Design Articles

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Executive & Director Pay Design

A New Way to Judge the Numbers For CEO Pay

Comparing the compensation and financial picture of three actual companies illustrates how three “tests” can help companies get a handle on the reasonableness of CEO pay.

The tests check for correlation between pay and performance, value sharing, and peer alignment. The analyses provide a compelling story about the aspects of design that contribute to an appropriate alignment of pay and performance. A dive into three companies’ pay and performance data provides a compelling guide for compensation committees trying to determine what level of pay is ‘just right.’

View the full article as it was originally published.

Seymour Burchman

Blair Jones

This article was originally published in Directors & Boards.

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