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    Compensation

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    Suparna Dv
    Executive compensation refers to the total reward provided to top executives such as the CEO, COO, and CFO. It includes basic salary, bonuses, shares, options, and other benefits. The objectives of executive compensation are to align managerial interests with ownership interests, enhance employee motivation and commitment, ensure financial security, attract the best executives, promote efficiency, and encourage learning. Elements of executive compensation include current core compensation like base pay and bonuses, short-term incentives, deferred core compensation such as stock compensation and golden parachutes, and fringe benefits. Factors affecting executive compensation are the complexity and competency of the job, an organization's capacity to pay, philosophy, and international impact.

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    Compensation

    Uploaded by

    Suparna Dv
    38 views9 pages
    Executive compensation refers to the total reward provided to top executives such as the CEO, COO, and CFO. It includes basic salary, bonuses, shares, options, and other benefits. The objectives of executive compensation are to align managerial interests with ownership interests, enhance employee motivation and commitment, ensure financial security, attract the best executives, promote efficiency, and encourage learning. Elements of executive compensation include current core compensation like base pay and bonuses, short-term incentives, deferred core compensation such as stock compensation and golden parachutes, and fringe benefits. Factors affecting executive compensation are the complexity and competency of the job, an organization's capacity to pay, philosophy, and international impact.

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    Executive compensation refers to the total reward provided to top executives such as the CEO, COO, and CFO. It includes basic salary, bonuses, shares, options, and other benefits. The objectives of executive compensation are to align managerial interests with ownership interests, enhance employee motivation and commitment, ensure financial security, attract the best executives, promote efficiency, and encourage learning. Elements of executive compensation include current core compensation like base pay and bonuses, short-term incentives, deferred core compensation such as stock compensation and golden parachutes, and fringe benefits. Factors affecting executive compensation are the complexity and competency of the job, an organization's capacity to pay, philosophy, and international impact.

    Copyright:

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    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    38 views9 pages

    Compensation

    Uploaded by

    Suparna Dv
    Executive compensation refers to the total reward provided to top executives such as the CEO, COO, and CFO. It includes basic salary, bonuses, shares, options, and other benefits. The objectives of executive compensation are to align managerial interests with ownership interests, enhance employee motivation and commitment, ensure financial security, attract the best executives, promote efficiency, and encourage learning. Elements of executive compensation include current core compensation like base pay and bonuses, short-term incentives, deferred core compensation such as stock compensation and golden parachutes, and fringe benefits. Factors affecting executive compensation are the complexity and competency of the job, an organization's capacity to pay, philosophy, and international impact.

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    Executive Compensation

    Meaning and Definition

    Executive Compensation is how top executives of business corporations are paid.

    This includes Basic salary, bonuses, shares ,options


    and other company benefits.

    According to Robert W. Kolb Executive compensation refers to the total reward provided by the firms to the top level of executives in a corporation such as Chief Executive officer(CEO), Chief Operating officer(COO), Chief financial officer(CFO) and other executives.

    Objectives

    Aligning managerial interest with ownership interest. Enhancing Employee Motivation, Involvement and Commitment. Ensuring Complete financial security. Bringing in the best executives. Promoting managerial efficiency Encouraging progressive Learning.

    Elements of executive compensation


    Current Core Compensation Short term incentives Deferred core compensation(Stock compensation) Deferred core compensation( Golden parachutes) Fringe compensation

    Current core compensation: Base pay Bonusesa. Discretionary Bonuses b. Performance- contingent Bonuses c. Predetermined allocation Bonus d. Target Plan Bonus ties.

    Short-term incentives:
    Companies award short-term incentive compensation to executives
    To

    recognize their progress toward fullfilling competitive strategy goals.

    It is usually apply to a group of executives within a company. The BOD distributes short-term incentive awards to each executive based on rank and compensation levels.

    Deferred core compensation


    It refers to an agreement between an employee and a company to render payments to an employee at future date.

    It creates a sense of ownership, aligning the interests of the executives with those of the owners or shareholders of the company over long term. Company stock shares are the main form of executives deferred compensation.

    Deferred core compensation(Golden parachute)


    Golden parachutes provide pay and benefits to executives after a termination resulting from change in ownership or corporate takeover. BOD include golden parachute clauses for two reasons.

    Golden parachutes limit executives risks in the event of these unforeseen events. Golden parachutes promote recruitment and retention of talented executives.

    Fringe compensation:

    Enhanced protection program benefits

    Prerequisites

    Factors affecting Executive compensation


    Complexity of the job Competency required Capacity to pay Organizational philosophy

    International Impact

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