Executive Compensation
Linking Executives Directly to the Strategy and Shareholders
The marketplace for strong executive talent is always highly competitive. When a strong executive is hired or terminated by a company, this action frequently makes a significant impact on the company’s share price. This reflects the importance shareholders place on the capabilities of leadership. Positioning your executive compensation competitively with the appropriately talent market is an important step in attracting and retaining key executives. But, more is needed.
Successful companies pay careful attention to both how much and how executives are paid. They seek to strengthen the alignment between performance that creates sustained competitive advantage and what is fair, appropriate within the organization and the broader marketplace. This is key to building real shareholder value.
Choosing the Right Approach:
Understanding what other companies are doing in your industry is important, but it is only a first step. It is perhaps more important that your programs become an integral part of your business’s strategy, reinforce your desired philosophy and are meaningful to your executives. Plus, the programs need to ensure that the fortunes of the executives are linked to the firm’s long-term success. We can help you understand your executive compensation programs through a new, unbiased and clear lens, and have the information on how well and how much you compensate executives to make a real difference in your business.
Executive compensation programs should answer the following questions:
- What basic structure best reflects our company’s philosophy and long-term objectives.
- What measures should be incorporated into each element of the executive compensation plan so executive’s interests are aligned with key stakeholders and the firm’s core strategy?
- What level and elements of total direct compensation are necessary to be competitive, cost-effective and meaningful to the firm’s key executives?
- What is the most effective mix between base, short-term, long-term compensation, and benefits and perquisites?
- How should executive compensation be managed and updated given changes in the marketplace, organization and individual performance? What is the role of the Board’s Compensation Committee in this process?
What the Wilson Group offers:
The Wilson Group works with boards of directors and executives to assure the executive compensation programs are highly effective, consistent with your firm’s philosophy, and reinforce the firm’s strategy and key success factors. We can help your organization to:
- Assess the competitiveness and effectiveness of the total direct compensation for key executives, including base salaries, short-term incentives, long-term incentives, benefits and perquisites.
- Design short-term incentive programs that are linked to annual business plans and performance requirements.
- Design long-term incentive, equity and/or equity simulator compensation programs tied to the strategy of the organization and its long-term value.
- Link all compensation plans including the executives and lower levels in the organization to the desired business planning, review, leadership and communication practices of the company.
- Provide the Board of Directors with information and independent guidance needed to fulfill their governance responsibilities to shareholders and other stakeholders in the corporation.
In many of these engagements our primary client is the Compensation Committee of the Board of Directors. We know the importance of their role and the challenges they face. We also favor working in collaboration with executive management, internal or outside counsel, internal and outside financial advisors, and human resources to make the best use of your available resources. We retain our objectivity and integrity to address key questions that each may have. Through our process, we ensure that information and recommendations support the core requirements of the organization, and we achieve critical agreements on what and how to make desired changes. This strengthens the capabilities and commitments of those that have a meaningful stake in the organization’s success.
We look forward to the opportunity of working with you and develop the total direct compensation programs that shareholders have confidence in and executive management views as aligned with the strategy and values of the corporation.
Please contact us at 978-371-0476 or at info@wilsongroup.com.
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