The market collapse and subsequent damage to company performance caused by the pandemic provided an opportunity for some US executives to demonstrate altruism. Some did. Others just figured out a way to get paid anyway.
Here’s an example. A company’s performance pre-Covid would have resulted in a payout of its long-term incentive (LTI) plan at just over 100% of target. But the last six months of a three-year performance measurement period were so bad that they wiped out any LTI payment altogether.
Solution? Ignore the last six months and pay out at just over 100%.
Result? Payouts ranging from $1m to $5.3m for executives and the CEO.
What? I hear you cry. No one would do that. Who would think they could get away with it?
But that’s not all.
The annual bonus wasn’t going to pay out either, so the remuneration committee decided to use the pre-Covid results for the first six months of fiscal 2020 (the company has a fiscal year which runs 1 Septem…