September 18, 2009
Pay Czar Ken Feinberg Poised to Issue TARP Pay Rules
– Broc Romanek, CompensationStandards.com
Yesterday, pay czar Ken Feinberg spoke at a FDIC conference on executive compensation here in DC (this Reuters’ article reports he has 8 speaking gigs before his end of October deadline) and, according to this BNET article, he said he would issue his blueprint for the top 25 employees at financial institutions receiving TARP funds within the next 30 days.
Here is a notable excerpt from the article:
Feinberg suggested the rules he lays out for these companies should serve as a precedent for the entire financial industry, said Jaret Seiberg, a policy analyst with Concept Capital’s Washington Research Group who attended the event. But how broadly the rules are applied is up to officials with the Federal Reserve and SEC, Feinberg noted.
A Light-Hearted Look at Harvard
Harvard has become well-known for its “Corporate Governance Blog,” founded by outspoken pay critic, Professor Lucian Bebchuk (the blog mostly has devolved into law firms posting the text of their firm memos unfortunately). That’s why I had a light-hearted Friday chuckle when a friend forwarded something called “The Daily Stat” which provides stats regarding “Which CEOs Took a Base Pay Cut?”
The stats only consider base salaries. Anyone remotely familiar with the topic of executive compensation recognizes that base salary is just a drop in the bucket of an executive’s pay package and that’s been the case for a few decades. Incentive compensation dwarfs salaries – and even bonuses, retirement pay or even perks can exceed salary amounts. Just so much misinformation out there about exec pay…