CIPD | CEO pay: complex solutions for complex problems

The median pay among the leaders of the UK’s largest listed firms was £3.61 million in the financial year ending (FYE) 2019, according to Executive Pay in the FTSE 100 report from the CIPD and the High Pay Centre. This amount is down marginally on the £3.63 million recorded …

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CIPD | CEO Pay: Complex Solutions For Complex Problems

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FAQs about CIPD | CEO pay: complex solutions for complex problems Coupon?

Can CEO pay to performance goals be too complex?

Tying chief executive officer (CEO) pay to performance goals aims to solve a classic principal-agent problem, helping to ensure that the CEO acts in the best interest of shareholders. But can it be too much of a good thing – can compensation contracts be too complex? Our research says yes. ...

Are CEO compensation contracts more complex?

We show that the components of pay more heavily weighted in CEO contracts (namely, short-term bonuses and stock awards) are more complex, suggesting that CEOs are exposed, in a material way, to complexity. That is, compensation contracts don’t just appear complex, they are economically complex. ...

Does contract complexity hide higher CEO pay?

One might argue that contract complexity is a means of hiding higher CEO pay. If this were true, we would expect more complex contracts to have higher ratios of actual payouts from bonus contracts relative to target (expected) payouts. ...

What does the CIPD survey reveal about employee financial wellbeing?

The CIPD’s eighteenth reward management survey reveals the UK benefits landscape and highlights the importance of employee financial wellbeing Roadmap for HR leaders seeking to broaden the remit of remuneration committees ...

Does CEO complexity affect firm value?

Complexity may represent board efforts to contract optimally or a means by which the CEO camouflages agency issues and rent extraction. I find evidence supporting the agency view by showing how complexity is negatively related to firm value, profitability, and CEO turnover–performance sensitivity. ...

What is the CIPD good work Index?

The CIPD Good Work Index provides an annual snapshot of job quality in the UK, giving insight to drive improvement to working lives The CIPD’s eighteenth reward management survey reveals the UK benefits landscape and highlights the importance of employee financial wellbeing ...