The factors that help explain the rise in executive compensation can be described as “organization size, growth opportunities, risk, equity structure, ownership structure, and manager age” (Factors Affecting Executive Compensation). Goals that executive compensation is the increase in globalization. The increase of globalization shows the competition for the talent and the higher pay compensation packages that occur. For compensation factors, looking and focussing on a short goal can be a big factor. Focusing on a project, or a short goal helps focus on the profits and performance on one product, which helps the compensation pay package to be rewarded based on the success you receive.
One view on executive compensation is excessive. Excessive executive compensation has been argued that their pay package is increasingly higher than should be compared to other pay packages. The critics that argue with excessive compensation believe that it is unfair because of their performance. They believe that it does not do anything to focus on their actual performance, and are paid more than they should. A valuable thinking for excessive compensation is the short term thinking, focusing on one goal, target, and getting a compensation prize for the success. Another view of executive compensation is if it is appropriate. The value of the appropriateness of the executive compensation shows between the market and its competitiveness. Because of the market, the jobs, and the competitions, it can be difficult to find someone who is going to work hard for your company, and get the best talent and employee there is to find. This compensation shows that they are willing to give them pay packages for the work they are willing to put in. The competitive market aligns with the accountability that one has for the company. In this case, the success of the company relies on the employer, which is an incentive to do well, and get the pay that they are inquiring as well.
The thing that really stands out to me when reading about executive compensation that I believe should be changed, or have an improvement, is the connection between the executive pay and their performance. This has already been established, but I believe there should be a better distinction between their pay and their pay package compensation. They should be able to get that compensation due to their success rate, but making sure that they hit all of the goals and targets that they are striving for. There should be more guidelines in being able to have a significant higher pay package than others.
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