A Remedy for Soaring Executive Pay: Focus Less on it

Abstract:     

This article argues that the increasing focus on pay by policymakers, shareholders, and the media has magnified its importance as a gauge of success for top executives and created a vicious cycle of ever-higher pay demands. It suggests ways for policymakers, shareholders, and boards of directors to de-emphasize monetary incentives, with the view to moderating the rapid ascent of executive compensation.

The author subsequently published an expanded version of this article in The Conference Board Review in April 2012, available at http://ssrn.com/abstract=2040868.

Number of Pages in PDF File: 2

Keywords: executive pay, compensation, financial incentives, corporate governance

JEL Classification: G34, G38, J33, M52