Incentive Design Varies by Industry: Spotlight on Electric Utilities
Journal of Compensation and Benefits November/December 2014
6 Pages Posted: 5 Dec 2014
Date Written: November/December 2014
This article provides an analysis of how incentives are being structured to connect pay and performance at electric utility companies. Within the largest 200 US public companies, there are 16 electric utility companies (“EUC-16”). We are looking at the EUC-16 as a separate group from the remaining 184 companies (“Top-184”). We have reviewed the incentive compensation programs, both short-term (“STI”) and long-term (“LTI”) in place for both the EUC-16 and Top-184, and have examined the differences in performance metrics governing these programs and the prevalence of long-term incentive vehicles among both groups.
Keywords: executive compensartion, pay for performance, incentive pay, electric utility industry, incentive compensation programs, performance metrics, top companies, CEO
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