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The Diminishing Returns Of Incentive Pay In Executive Compensation Contracts, Gregg D. Polsky, Andrew Lund
The Diminishing Returns Of Incentive Pay In Executive Compensation Contracts, Gregg D. Polsky, Andrew Lund
Scholarly Works
For the past 30 years, the conventional wisdom has been that executive compensation packages should include very large proportions of incentive pay. This incentive pay orthodoxy has become so firmly entrenched that the current debates about executive compensation simply take it as a given. We argue, however, that in light of evolving corporate governance mechanisms, the marginal net benefit of incentive-laden pay packages is both smaller than appreciated and getting smaller over time. As a result, the assumption that higher proportions of incentive pay are beneficial is no longer warranted.
A number of corporate governance mechanisms have evolved to duplicate …
Officers And Directors Compensation In American Law, Laurence Melanie Rouzioux
Officers And Directors Compensation In American Law, Laurence Melanie Rouzioux
LLM Theses and Essays
Since the 1980s, executive compensation of directors and officers in U.S. Corporations have increased sharply. This paper reflects upon the public criticism of corporations that paid exorbitant amounts as salary and other benefits to their directors and officers. This paper focuses on the laws of corporations in Delaware as they relate to directors and officers’ compensation. The author examines different concepts such as the doctrine of waste that creates a duty that a corporation cannot give away or waste its assets. The author concludes that executive compensation packages should mirror Delaware corporation laws while remaining reasonable flexible to account for …