Visit our new site at BusinessJournalism.org
Reynolds Center Programs
Daylong Workshops
Online Seminars
One-hour Tutorials
Barlett & Steele Awards
Professors Seminar
Strictly Financials Seminar
Research
Covering Business
Starting Out
Business Writing
Business Design
Business Glossary
Ethics
Five Questions with...
Immigration Series
Business Journalism Resources
Job Listings
Academic Programs
Book Listings and Reviews
Scholarships
Calculators
Web Resources
Tutorials
Article Index
Workshop Registration
The Reynolds Center has announced its 2009-10 free workshop schedule.
Select a workshop and register from the drop-down menu below.
Online Seminars
The Reynolds Center registration for Fall 2009 free online seminars.
Hooked on Kindle
By Chris Roush
Tracking the Business Behind the Tomato
By Jonathan Higuera
Five Questions with Bill Choyke
By Jonathan Higuera
Finding the Economy's Silver Lining
By Dick Weiss
Double Whammy: Oil and Housing
By Jennifer Hopfinger
Record Bonuses Should Raise Compensation Radar for Business Journalists
By Chris Roush
January 31, 2007
Recent coverage of multi-million dollar bonuses given to the CEOs of Morgan Stanley and Goldman Sachs -- as well as the $210 million parachute to the former Home Depot CEO -- should serve as a warning to business journalists to pay more attention to compensation in the coming months.
Why? If the money given out at Wall Street investment banks and to departing executives is any indication, then 2007 is looking like a big year for executive compensation as a story.
Public companies disclose salaries, bonuses and other parts of executive compensation in their proxy statements, which are typically filed with the Securities and Exchange Commission six to eight weeks before their annual meetings.
That typically means proxies begin to be filed in February as most companies whose fiscal year coincides with the calendar year hold annual meetings in April and May.
Here are some things I like to look for, besides executive compensation, in proxies:
1. The perks given to executives, such as country club memberships and personal use of corporate jets and cars. These sometimes are worth more than the salary or bonus.
2. The compensation committee report. This often discloses how the company determined the CEO's pay, and whether he or she is in line for a pay hike.
3. Outside shareholder proposals. In recent years, these proposals, which are voted on by all stockowners, have increasingly focused on limiting huge compensation packages.
4. The stock option chart. Given the increased focus on the timing of grants, reporters should be looking at when companies gave options.
5. Relationships between board members and the company. This is where you find the "I'll scratch your back if you scratch mine" dealings.
The SEC has changed the rules for proxy statements this year, making it easier to understand the total amount of an executive's compensation. That should make it easier for reporters to cover these stories.
The compensation of every local public company should be written about by the local paper. It's an important story that tells local investors and employees how much the board values the management team's performance
More important, I think the story should compare the increase -- or decrease -- in the CEO's compensation to how the company's profits and stock price performed during the same time period.
That lets readers know whether the pay was truly based on performance. In the case of the investment banking firms -- Goldman reported the highest annual profit in Wall Street history -- the CEOs are being paid record bonuses for record net income.
Email this article
Copyright © 2008 Donald W. Reynolds National Center for Business Journalism
The Reynolds Center has announced its 2009-10 free workshop schedule.
Select a workshop and register from the drop-down menu below.
The Reynolds Center registration for Fall 2009 free online seminars.
By Chris Roush
Tracking the Business Behind the Tomato
By Jonathan Higuera
Five Questions with Bill Choyke
By Jonathan Higuera
Finding the Economy's Silver Lining
By Dick Weiss
Double Whammy: Oil and Housing
By Jennifer Hopfinger
Record Bonuses Should Raise Compensation Radar for Business Journalists
By Chris Roush
January 31, 2007
Recent coverage of multi-million dollar bonuses given to the CEOs of Morgan Stanley and Goldman Sachs -- as well as the $210 million parachute to the former Home Depot CEO -- should serve as a warning to business journalists to pay more attention to compensation in the coming months.
Why? If the money given out at Wall Street investment banks and to departing executives is any indication, then 2007 is looking like a big year for executive compensation as a story.
Public companies disclose salaries, bonuses and other parts of executive compensation in their proxy statements, which are typically filed with the Securities and Exchange Commission six to eight weeks before their annual meetings.
That typically means proxies begin to be filed in February as most companies whose fiscal year coincides with the calendar year hold annual meetings in April and May.
Here are some things I like to look for, besides executive compensation, in proxies:
1. The perks given to executives, such as country club memberships and personal use of corporate jets and cars. These sometimes are worth more than the salary or bonus.
2. The compensation committee report. This often discloses how the company determined the CEO's pay, and whether he or she is in line for a pay hike.
3. Outside shareholder proposals. In recent years, these proposals, which are voted on by all stockowners, have increasingly focused on limiting huge compensation packages.
4. The stock option chart. Given the increased focus on the timing of grants, reporters should be looking at when companies gave options.
5. Relationships between board members and the company. This is where you find the "I'll scratch your back if you scratch mine" dealings.
The SEC has changed the rules for proxy statements this year, making it easier to understand the total amount of an executive's compensation. That should make it easier for reporters to cover these stories.
The compensation of every local public company should be written about by the local paper. It's an important story that tells local investors and employees how much the board values the management team's performance
More important, I think the story should compare the increase -- or decrease -- in the CEO's compensation to how the company's profits and stock price performed during the same time period.
That lets readers know whether the pay was truly based on performance. In the case of the investment banking firms -- Goldman reported the highest annual profit in Wall Street history -- the CEOs are being paid record bonuses for record net income.
Copyright © 2008 Donald W. Reynolds National Center for Business Journalism