Executive
Stock markets
LEADERSHIP & STRATEGY
Executive
Compensation and COVID-19 : What ’ s Happening ?
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Stock markets
Suffering one of its largest negative closing milestones , the S & P 500 index recorded a 30.75 % decrease on the levels at the end of 2019 , totalling 2237.40 points following the outbreak of COVID- 19 in March .
Whilst the S & P 500 index has begun to recover – currently sitting at 3,733.24 points – many organisations continue to be impacted by the pandemic , with stock price in many sectors including energy , consumer discretionary , finance and real estate struggling to recover and suffering losses or reduced profits .
With this in mind , Bachelder reflects on executive compensation in the form of company stocks . “ A question may be asked whether these losses should be borne by the executive holding the employer stock without some form of mitigation [...] This in turn raises the question whether executives holding shares of employer stock are really ‘ in the same shoes ’ as non-employee investors ( the latter can invest or sell off their interests in company stock as and when they see fit ). An executive ’ s interest in the employer stock is in large measure employment-related
FEBRUARY 2021