Prof. Vaaler Quoted in Minneapolis-St. Paul Business Journal on CEO Compensation and Corporate Governance Trends During COVID-19 Pandemic
John and Bruce Mooty Chair in Law & Business, Professor Paul M. Vaaler, was interviewed last month by a reporter from the Minneapolis-St. Paul Business Journal (subscription required) for insight on non-salary CEO compensation trends during the current COVID-19 pandemic. Professor Vaaler pointed out how non-salary, often stock-based compensation, comprises a much larger percentage of overall compensation for CEOs, thus cutting salaries is more symbolic than real and substantial. The run-up in stock prices since March follows largely from extraordinary fiscal and monetary stimulus rather than strategic initiatives by firm CEOs. Corporate boards need to adjust overall CEO compensation, including non-salary stock-based components to incent faster adaptation to current pandemic and post-pandemic conditions in the near term.