CEO pay fell nationally in 2008, but will the pullback last? The answer hinges on whether corporate boards make changes now to keep compensation at less stratospheric levels for the long term.
For critics of high executive pay, this is the year when public and political anger has lined up firmly on the side of reform. But those involved in setting pay — directors, lawyers and consultants, among others — face the genuine challenge of retaining and attracting top executive talent without fueling an even greater public backlash against CEO pay.
Since the start of the year, boards have been huddled with compensation advisers to figure out what is appropriate to pay top executives during the worst economic crisis in decades. Because of the collapse in corporate earnings and stock prices, many executives won’t meet performance targets that help set their pay. That could shut CEOs out of cash or stock bonuses at the same time their existing stock compensation has lost much of its value. The Associated Press
