This is a very well-written article, and has two important points relating to compensation, underscoring my message in the previous post here “Beware the Fake Compensation Survey Data“ The article appears in today’s Cannabis Business Times, authored by Loren Picard, CEO of High Desert Flower, Inc. in Oregon. Here are two points that underscore the compensation challenges facing cannabis entrepreneurs: … Read More
We have a new incentive plan, what could possibly go wrong? (almost everything)
In this week’s edition of The Economist, the columnist Bagehot writes “How the British government rules by algorithm” (subscription required, and well worth it!). Compensation professionals: don’t leave this blog posting just yet. I’ll cite three examples they reference that speak for themselves, all direct quotes from the concise one-page article. “Targets create three common problems. They produce perverse results … Read More
“Retirement” or “Severance” and the disclosure of either or neither or both
Topic: Executive CompensationSub-Topic: Compensation Arrangements for Departing ExecutiveCompany: Arena Pharmaceuticals (ARNA) Most small companies have no retirement benefits or pensions, especially entrepreneurial cannabis companies. This follows the pattern of technology company startups over the past several decades. They frequently have severance arrangements for departing executives, and these are quite varied, from “none” to “lots” and every gradation in between Arena … Read More
Cannabis Compensation #5: Cannabis is a Schedule I Drug So We Can’t Have a 401(k) Plan, Right?
Wrong. Cannabis firms that “touch the flower” are operating under the shelter of their state’s law but are in violation of the federal Controlled Substances Act, categorizing cannabis as a Schedule I drug, along with heroin, LSD, and meth (cocaine is mere Schedule II drug along with Vicodin, Ritalin, and codeine; go figure). Cannabis is considered a “gateway drug” – once … Read More
The Problem with CEO “Pay Cuts”
CEO “pay cuts” are in vogue, from 100% salary reductions at companies including Alaska Airlines, Marriott, and Dick’s Sporting Goods to meaningless cosmetic actions like the CEO of Southwest Airlines taking a 10% salary reduction. These actions are concentrated in the industries most affected by the COVID-19 crisis: Airlines, hotels, movie theaters, restaurants, and the like. These range from 100% salary reductions … Read More
Conscious Compensation® – The Next Step Podcast
https://soundcloud.com/the-next-step-podcast/guest-16-fred-whittlesey-conscious-compensation
Stupid Compensation Plans – The Next Chapter
I am not understanding how a prospective, not retroactive, reduction in corporate tax rates should result in boards of directors and executives thinking that this should justify a $1,000 bonus for every employee. Whether you are an airline, or a bank, or neither an airline or a bank. Nevermind pay-for-performance so that people about to be fired get the same as the … Read More
It’s Time to Kill Merit Increase Processes and Salary Budget Surveys – What Better Time to Start Than Labor Day?
Fred Whittlesey Compensation Venture Group, SPC An oversize postcard in my mailbox today – yes, a real physical heavy stock paper postcard – is touting the value of the 44th annual salary budget survey from a compensation professional association. The pitch says that this survey “will provide the knowledge you need.” If I told you that the message on the … Read More
Restructuring Executive Incentive Metrics for Sustainability
The growing global movement of corporate social responsibility, sustainability, conscious capitalism and environmental, social and governance (ESG) criteria is on a collision course with the executive compensation world’s focus on shareholders and adherence to proxy advisers’ checklists. Executive compensation performance measures must evolve quickly, but what’s lacking is a cohesive and comprehensive framework for defining metrics that are consistent with … Read More
