Rethinking Executive Incentives Can Boost ESG Performance
Changing the incentive structure can help companies run more ethically in the long term.
Anytime the economy hits a downturn, itâs a familiar story: Companies cut expenses through layoffs, and top executives get bonuses for keeping stock prices up. Today, this arguably hurts employees more than it used to. Even before the pandemic, 17% of adults could not pay their bills, and 24% skipped medical care because they didnât have the money. And given the bruising, consistent rise in income inequality, the average employee lives paycheck to paycheck.
Meanwhile, in 2021 the average ratio of CEO pay to worker pay among S&P 500 companies was 324-to-1, and ...
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