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How to fix the executive compensation problem

Rob Enderle | Oct. 17, 2016
Columnist Rob Enderle writes that U.S. executive compensation practices are broken. A recent Harvard Business Review ranking in which only one U.S. CEO made the top 10 pinpoints the problem.

But you can’t game a system for more than a few years and you sure can’t game it for over a decade, which is why the Harvard Business Review process is so important. The Harvard Business Review process rewards true performance, not how well some executive gamed the system.

The subtle irony of this win for Jen-Hsun is that he actually runs a company known for gaming technology and he didn’t game the system to win. But this is often the case with founders, they end up with not only the money, but the pride of accomplishment that comes from actually building something that will outlast them.  

Executive compensation is broken

This is a long way to get to my recurring point that executive compensation is really broken in the U.S. The fact that only one U.S. CEO made this top 10 list showcases this problem. The technology industry was founded by people who put their pride for a job well done in front of their desire to have the biggest home or most expensive car. Instead, they got something invaluable, the respect of their peers, the loyalty of their people and the knowledge at the end of their career that they left their firms massively better than they found them.  

 

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