We use cookies to collect information about how our website is used and to improve the visitor experience. You can change your browser’s cookie settings at any time. Please review our privacy policy for more information. OK
Nearly half of executives (42.7%) feel there isn’t enough detail in the information they receive about incentive pay, according to a new study by the compensation consulting firm Pearl Meyer & Partners. Conversely, only 8% of directors say the same, and the gap in understanding could lead to missed targets and misplaced priorities.
“There’s a lot of attention around disclosures and proxies for say-on-pay reasons, but you don’t really hear much about the complexity of how you’re going to talk to your executives about the very same thing,” says Sharon Podstupka, vice president of executive compensation communication at Pearl Meyer [& Partners]
“We know that poor communication leaves things open to interpretation,” says Podstupka. “If executives responsible for driving results aren’t clear about what the goals are and what they can do to affect specific metrics, it’s highly likely that performance results over the long term are going to suffer because people aren’t focused on the right things.”
According to Podstupka, developing a communication strategy for incentive pay can help companies meet performance goals.