Publication Date

Spring 2013


The trend toward incentive-based, long-term compensation has increasingly strengthened as companies seek to align shareholder, management, and executive interests, especially in light of the financial crisis of 2008. Privately held companies face a unique challenge because they are not in a position to easily offer stock options as a means of a long-term incentive plan; although possible, it is both cumbersome and dilutes the owners’ control of the company. We have identified two alternative means of providing incentives to managers and executives: deferred compensation and the use of perquisites. In addition, we provide a closer at look at the impact and efficacy of the trend toward incentive-based pay on employee and business performance.


Suggested Citation
Calder, J. & Shah-Hosseini, S. (2013). What are the most effective executive compensation strategies for levels not eligible for long term incentive? Retrieved [insert date] from Cornell University, ILR School site:

Required Publisher Statement
Copyright by the authors.