Partial profile · Book Profile — full narrative profile planned
Executive Compensation
A comprehensive casebook introducing the complex legal and regulatory landscape of executive compensation in the United States, including tax, securities, state corporate law, and governance issues.
A profile of this book is on the way.
What it’s about
This casebook provides a foundational understanding of executive compensation law, a specialized field that intersects with tax, securities, corporate governance, and employment law. It's designed for students and practitioners without prior specialized knowledge, offering narrative explanations of complex rules alongside cases, commentary, and regulatory materials. The book covers everything from the controversies surrounding executive pay levels to the technical details of deferred compensation, equity awards, and perquisites. It also examines the governance structures of public companies, special rules for nonprofits and financial institutions, and how executive compensation is handled in major corporate transactions like mergers and acquisitions. This is an essential guide for anyone advising businesses, from small proprietorships to large public corporations, on how to structure and regulate the pay of their top leaders.
The through-line
- Who it’s for
- An aspiring or current legal professional, corporate advisor, or law student who needs to understand the complex world of executive compensation. They want to be able to advise clients effectively, navigate intricate regulations, and structure pay packages that are both attractive and legally compliant.
- The problem
- The reader faces a dauntingly technical and fragmented body of law governing executive compensation, spanning tax, securities, and corporate governance, with no single, unified guide. They feel overwhelmed and unprepared to deal with the specialized jargon, complex statutes (like §409A), and high-stakes issues involved in executive pay, fearing they might give bad advice or miss critical compliance points.
- The plan
- Start with the foundational concepts of tax timing and deferral that underpin most compensation design.
- Master the key categories of executive pay, including deferred compensation, equity awards, and perquisites, and their respective regulatory treatments.
- Learn the governance framework, including the role of the board, the business judgment rule, and federal securities regulations that constrain compensation decisions.
- The payoff
- The reader becomes a confident and competent advisor on executive compensation. · They can structure compliant and effective pay packages for clients ranging from startups to public corporations. · They can navigate the complexities of tax codes, securities disclosures, and corporate governance with ease.
See our guide
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Additional reading
- Pay without Performance: The Unfulfilled Promise of Executive Compensation · Lucian Bebchuk and Jesse Fried
This book is presented as the primary academic work arguing that high executive pay is a result of the 'managerial power' thesis, where executives exploit weak corporate governance and captured boards to extract rents, rather than being a product of arm's-length bargaining.
- The Real Story Behind Executive Pay: The Myth of Crony Capitalism · Steven N. Kaplan
This article is excerpted as the main counter-argument to Bebchuk and Fried, contending that high CEO pay is a result of market forces and a competitive 'market for talent,' similar to star systems in sports or entertainment, and is not primarily due to governance failures.
- Bonus Questions: Executive Compensation in the Era of Pay for Performance · Charles M. Yablon
Provides a historical overview of executive compensation, tracing its evolution from the era of owner-managers through the conglomerate mergers and hostile takeovers, leading to the modern focus on performance-based pay and incentive alignment.
- Are American CEOs Overpaid, and, If So, What If Anything Should Be Done About It? · Richard A. Posner
This article offers a prominent law and economics perspective that largely sides with the managerial power thesis, arguing that feeble board incentives and conflicts of interest lead to excessive pay. It also proposes several regulatory reforms, such as enhanced disclosure and back-loaded compensation.