Consulting On Pay For Performance
We view compensation as a critically important element of management. Well conceived and structured compensation programs serve to attract, retain and motivate the people that every company depends on to achieve their goals and objectives. Compensation, however, should not lead the strategy and planning processes; rather the compensation program should be aligned with and supportive of each company's strategy and operational plans. We strive to help companies develop compensation programs that lead executives and managers to make the right decisions for the company and its shareholders.
Over the last few years, there has been a great deal of attention focused on the state of executive compensation in U.S. industry. Government leaders, the investing public and the press have been sharply critical of both high executive pay arrangements and the board committees that approve or set executive compensation. Some of the criticism may have been justified, but some of it clearly reflects a lack of understanding of the process and forces affecting compensation.
The new legislation and regulations on compensation practices and reporting are likely to continue changing the corporate governance landscape. We believe, therefore, that it is advisable for compensation committees to retain consultants who are independent of management.
All companies should take steps to ensure that their houses are in order and that they are not susceptible to the kinds of criticisms now being aired generally.
To ensure that clients derive maximum benefit from each engagement, LB&Co. follows these fundamental guidelines:
- At least one Director of the firm supervises every engagement, participates actively in all phases of the work and is personally responsible to the client for its successful completion.
- Analysis is performed, opportunities for improvement are identified and solutions are developed on the assumption that each client is unique. The firm draws on its experience but strives to develop imaginative, original solutions that suit particular client needs.
- Each project is undertaken with the objective of seeking solutions that are realistic and practical and that lend themselves to prompt and economical implementation.