As the news emblazons with corporate scandals, it’s worth pausing and seeing how other countries approach business executive compensation. No need to reinvent the wheel, as the aphorism goes.
Recently in January, WorldatWork published a book, “Executive Compensation Practices in the UK” about how the United Kingdom deals with executive pay and bonuses, long-term compensation, benefits, and pay scale. The book focuses on recent history and how new regulations impact compensation for key executives.
The authors of Executive Compensation Practices in the U.K., Steven Balsam, Ph.D., Yu Flora Kuang, Ph.D., and Bo Qin, Ph.D., are all university professors with expertise in the fields of executive compensation, earnings management and corporate governance.
According to the WorldatWork press release, the book covers the following topics:
– The important role long-term incentives play in compensation packages.
– “Tournament Theory” pay practices.
– “Say on pay” which has been law in the U.K. since 2002.
– What regulators in the U.K. are doing to keep an upper hand on executive compensation in the wake of eye-popping corporate scandals.
– Types of taxes and accounting standards that apply to executive compensation.
Over the past few years, executive compensation has been in focus, especially at financial firms and investment banks which use bonus structures as the main compensation vehicle. In general, it is a very good idea for recruiters to familiarize themselves with current trends in compensation because of their intimate relationship to salary negotiations. We can expect more analysis coming out on the changes in regulation on executive pay and on the aftermath of the financial crisis.