One of the biggest challenges faced by organizations around the world is how to align managerial incentives to shareholder interests. We have seen that budget-based profit based incentive systems simply do not work. In fact, not only are the current methods for determining executive compensation wrong but they have consistently failed to deliver the results demanded by shareholders.
There is another approach to executive compensation; one that is based on the economic value creation (EVC) of the enterprise.
By designing value metrics, identifying value drivers, and designing line of sight incentive systems, we design customized executive compensation systems that are significantly different form the current systems that are in place.
Beginning with a comprehensive value circle assessment, our aim is to:
- inform by means of executive briefings,
- instruct with managerial training,
- interpret by using technology and actual data, and
- implement by providing leading-edge tools and techniques, an incentive and analytical framework, and a comprehensive communications platform.
This methodology not only enables clients to understand how to create economic value, maximize shareholder wealth, and adopt a value-based management philosophy, but also gives executives and managers an understanding of the value drivers critical to their organization, enabling them to link corporate strategies to their own performance and compensation.
Our value creation services team has extensive skill in the practical application of effective value creation performance measurement systems, proven experience in the development and implementation of information management systems for effective strategic decision-making, and our expertise in aiding clients to significantly improve both value creation performance and share price is acknowledged globally.
See our case studies for some real world examples of our approach.
Contact us to learn more about our unique approach to Executive Compensation.