To Compete, Update Your Incentive Program Annually

Chief Executive Research Uncategorized

This is the second in a series on executive compensation, based on findings from our exclusive 2018-19 CEO & Senior Executive Compensation Report for Private Companies, which gathers data from over 1,600 private companies.

When it comes to valuing, updating and communicating the benefits of executive compensation programs, there is a huge gap in best practices among American companies, largely based on size, and in an economy with plenty of options for talented executives in almost every industry, this can represent a significant—and preventable—risk that CEOs should not overlook.

We found that 93% of companies with a $1 billion+ in revenue had a formal long-term incentive plan with equity, updated annually. But among smaller companies, with revenue in the $10 million to $24.9 million range, only 54.67% had formal incentive plans in place.

If you’re a family business or someone who can’t offer long-term equity, what can you do? There are few ways to offer incentives without offering equity.

Read the full article here.