Adding stock options and bonuses for performance to the compensation of a manager is intended to closer align the interest of the manager with

Question

Quizplus · Accepted Answer

Stock options and performance-based bonuses are typically tied to the company's stock price and financial performance, therefore aligning the manager's interest with that of the stockholders. The manager will be motivated to make decisions and take actions that benefit the company's financial performance, leading to a higher stock price and increased value for the shareholders.

Adding Stock Options and Bonuses for Performance to the Compensation