What is true of top management compensation?
A) Stockholders and key stakeholders support paying CEOs higher salaries because they recognize the importance of capable leadership.
B) If a company performs poorly, the CEO is given higher pay to motivate him or her to work harder to improve performance.
C) Stakeholders give top management perks and special treatment for doing a good job.
D) Compensation committees are working with boards of directors and CEOs to detach salary from performance because it isn't fair to hold top managers solely responsible for the company's performance.
E) Many firms are trying to align CEO compensation with performance.

Question

Quizplus · Accepted Answer

Compensation committees are increasingly working with boards of directors and CEOs to align CEO compensation with performance in order to benefit stockholders and key stakeholders. Stakeholders often criticize the perks and special treatment top management receives.

What Is True of Top Management Compensation