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0 pointsrubyn00bie6y ago0 comments

I doubt any CEO's compensation is tied to anything beyond five years; and, I bet even terms at five years are sparse limited to a few giant names who have to (like Tim Cook) otherwise the stock price would collapse and that's it.

I'd like to add: there is no incentive for it either, shareholders want returns NOW, and so they want CEOs to act in their interest NOW. Most shareholders aren't looking at their "ownership" stake with compassion for employees at the company, or any form of responsibility to other stakeholders, but solely for their own bottom line.

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3 comments · 2 top-level

alasdair_6y ago· 1 in thread

>there is no incentive for it either, shareholders want returns NOW, and so they want CEOs to act in their interest NOW.

Many of the biggest shareholders are major pension funds with 30 to 50 year time horizons. They absolutely do NOT want "returns NOW" with the implicit assumption that future quarters don't matter.

goatinaboat6y ago

They absolutely do NOT want "returns NOW" with the implicit assumption that future quarters don't matter.

That is true but it is also true that they can’t risk waiting 30 years only to find their investment is worthless. Hence the insistence on quarterly reporting.

redblacktree6y ago

> shareholders want returns NOW

I know this is the received wisdom, but as a shareholder, I emphatically do not want this. I want long-term value, as I am a long-term investor. I hate that I have to watch out for shady things like this and adjust my holdings accordingly.

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