Published by:
Harvard Business Publishing
Length: 9 pages
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Abstract
Performance compensation for policy-level executives is interdependent with company policy. Survey data show that most companies use cash bonuses and some additional compensation while few companies rely on stock options alone. The character of the bonus system is interrelated to the company''s growth. The range of possible payoffs and the variability of bonuses increase, and bonuses become more directly related to performance as a company expands.
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Abstract
Performance compensation for policy-level executives is interdependent with company policy. Survey data show that most companies use cash bonuses and some additional compensation while few companies rely on stock options alone. The character of the bonus system is interrelated to the company''s growth. The range of possible payoffs and the variability of bonuses increase, and bonuses become more directly related to performance as a company expands.