In the wake of COVID-19 and its impact on the American economy, compensation for executives of bankrupt corporations has been heavily scrutinized by laid off employees and the public.1 While executive compensation was already a hot topic of focus for the public and investors in the past decade, recent bankruptcy activity due to COVID-19 has…
Tag: Executive Compensation
Being “Green” is Not Always a Good Thing: Examining the Legality of CSR-based Executive Compensation Metrics
On August 19, 2019, the Business Roundtable1 released its “Statement on the Purpose of a Corporation.”2 This statement broadly articulates that a corporation’s purpose is to serve the interests of (1) its customers; (2) its employees; (3) its suppliers; (4) its communities, and (5) its shareholders.3 The statement concludes, “Each of our stakeholders is essential….
Amazon’s Lawsuit and Non-compete Agreements for Executives
On March 21, 2016, Amazon filed a suit in Washington state court seeking enforcement of a non-compete agreement signed by a recently departed executive.1 Arthur Valdez had been serving as vice president of operations for Amazon and oversaw the companies’ supply chain and logistics operations but recently left to become the chief supply chain and…
The SEC – Catching up to the Clawback
In response to the major accounting frauds in the early 2000s, the Sarbanes-Oxley Act required chief executives and chief financial officers to affirm the accuracy of their books.1 In practice, this relevant portion of the Act sought to eliminate the temptation among executives to misstate their companies’ financial positions, which made the company look better…