It has been a number of years since executive compensation has been such a scorching topic in the boardroom and the media. Just take a gander at a few press headlines from earlier this year:
* "Goldman Shareholders Revolt Against Top Executive Pay"
* "Google CEO Gets $199 Million Equity Award"
* "Ex-Valeant Chief Pearson Walks Away with $10 Million Despite Shares Falling 90%"
* "Investors Want Mutual Funds to Get Tougher on CEO Pay"
* "Why It Is Time to Curb the Madness of CEO Pay"
* "Boards Are Responsible for Limiting Pay Excess"
With media focus like this--a time when executive pay is described as "galactic," as the Financial Times did so recently--attention must be paid. Directors & Boards has selected The Compensation Handbook [Sixth Edition] as the 2015 Governance Book of the Year. Subtitled A State of the Art Guide to Compensation Strategy and Design, the book was published in July 2015, well timed to ride a mounting wave of concern about the level of executive pay and the board's role in crafting and approving exec comp. The 600-page book includes 51 chapters, each written by experts in the tools and tactics of comp design and strategy. [Directors & Boards Publisher Robert Rock, drawing on his extensive board service, contributes a chapter on the workings of the compensation committee of the board.) The author/editors are Lance A. Berger, managing partner of Lance A. Berger & Associates Ltd. and a longtime specialist in compensation and talent management, and Dorothy R. Berger, a partner in the firm. The Bergers collaborated on earlier editions of The Compensation Handbook. According to the book's publisher, McGraw-Hill (www.mhprofessional.com), this latest edition "continues the value-creating heritage established by its predecessors." A passage from Lance Berger's introductory chapter follows.
The first edition of The Compensation Handbook was a snapshot of the compensation practice as it had evolved prior to 1972. Each subsequent edition was a time capsule containing a rich trove of information representing the cumulative successes of its predecessors as well as the best new practices, issues, procedures, and processes that would be useful in the future. This sixth edition extends this evolution of knowledge to the current time.
Every organization needs a designated group of...