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Industry Moves How Performance Shares Add Transparency to Executive Compensation
Charles "Chuck" Steege CFP Launches Compensation Forum for Vexed Executives
By: John Drachman
Mar. 16, 2010 08:40 AM
(DOYLESTOWN, PA) Senior executives who don’t know their restricted stock units from their non-qualified options no longer have to suffer alone. Charles “Chuck” Steege CFP this week launched the SFG Executive Compensation Forum to explore the growing complexity of how – and with what – executives are being compensated. “In addition to the tax consequences of their decisions and their comfort with risk,” Mr. Steege, SFG Wealth Planning Services, Inc., SFG Wealth Planning Services, Inc., said recently, “Today’s executives must also be concerned with their firm’s appearance as a transparent, responsible corporation, when it comes to their compensation policies.” While a lot of fire has been directed at the big Wall Street banks, Mr. Steege continued, concerns over heavily paid executives have spread to other industries. "Perception is reality when it comes to executive compensation,” he said. “The drawback occurs when investors push a company’s stock price down because they think a company is paying an executive at their expense.” What happens in such a case, he added, is this: “The investor loses because the executive looks greedy; then, the executive loses when her stock-based compensation declines in value.” While tensions between shareholders and boards have been rising for two years with more votes cast against remuneration reports than ever before, Mr. Steege highlights an attractive alternative: performance shares. "A growing number of companies are making stock grants that base your profit on more than just your continued employment or an increase in the company's stock price," Mr. Steege continued. It was to explore the benefits of strategies like this that Mr. Steege launched his new blog: SFG Executive Compensation Forum. The Forum, according to its site, has been “designed for senior level executives to participate in discussions about trends, legislation and best practices in this vital centerpiece of human resources strategy. “Together,” Mr. Steege concluded, “We will explore ideas, models, methods and theories around the growing interdependence of executive compensation and corporate responsibility." Reader Feedback: Page 1 of 1
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