Thursday, June 6, 2013
KPMG’s Spring Audit Committee Roundtable Series—Raising the Board’s Game in 2013—will explore critical areas of governance that have moved from important to imperative in helping audit committees and boards guide their companies forward.
Focus on Internal Metrics Rather Than External Factors Essential for Effective Pay Structure
Read The New York Times coverage of the research here.
– An over-reliance on peer group compensation benchmarking is central to the persistent issue of rising executive pay in the United States, new research finds. While other research examines flawed peer group methodology, this new study makes it clear that peer grouping with minimal board discretion is a seriously flawed methodology even when the peer groups are fairly constructed. The study also is the first to document that peer group benchmarking - now so widely utilized that it is enshrined in federal regulations - has accidentally become the de facto standard even though it never was designed to determine CEO compensation.
Download the full study here or at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2125979.
