Pay Performance for Directors

Read this article in the Business Times: here

• PUBLIC-LISTED companies (PLCs) should pay their directors based on their performance in order to be fair to them, the stakeholders and minority shareholders, the Minority Shareholder Watchdog Group (MSWG) said.
  
  "The basic rule of pay per performance should apply. If the firms are making losses, the directors should just get nominal pay," MSWG chief executive officer Abdul Wahab Jaafar Sidek told Business Times.
  
  If the firms are to perform well, they should also equally reward the stakeholders and shareholders, he added.

Hmmm..... extremely good suggestion in my opinion. Far too many directors do not appear to be bothered about the performance of the listed company.

The article continues by saying...

• The MSWG is currently working on a similar salary survey that may take a few months to complete, Abdul Wahab said.One of the best ways to set the remuneration band is through key performance indicators, he said.Offering salaries based on that measure also suggests better transparency towards the minorities.The MSWG has been encouraging the PLCs to be more transparent in disclosing remunerations. It shares the same view as Bursa Malaysia Bhd's chief Yusli Mohamed Yusoff.

What say you?

Do you reckon that this is a good move?

And how about cleaning up the huge mess in the ESOS????

ps..

Let me SHOW YOU WHERE IS ZE MOOLA!!!!

back in July 2006, there was an article on Fortune stating the issue of high CEO pay. here

• Lee Raymond$405 Million That's the 2005 comp, lump-sum pension, and current value of various stock grants with which Exxon's chief rides into retirement.
• Bob Nardelli$250 Million The total value of the package Home Depot has paid him so far. He's collected about 30%. The rest varies with the stock price.
• William McGuire$1 Billion UnitedHealth's CEO holds a ton of options. Alleged accounting flaws have hit the stock. But his potential reward (above) remains rich.
• Hank McKinnell$99 Million Pfizer's CEO took heat for a hefty pension built up over many years (present value: $83 million). He earned $16 million in 2005.
• Franklin Raines$90 Million Fannie Mae's boss made that from 1998 to 2003. But auditors now say the earnings his comp was based on were overstated by $11 billion.
• Phil Purcell$66 Million Morgan Stanley's stock fell 25% in the past five years. Pushed out last year, he collected this amount in severance plus 2004 pay.