The Guiding Principles for executive compensation in service of an IPO

April 30, 2018

As companies transition from privately-owned to publicly-traded companies, there is frequently a need to reconsider executive compensation (EC) policies so they align more closely with investors’ expectations and public company practices. Four overarching EC principles form the foundation of an effective EC program. Because an initial public offering (IPO) by definition transfers ownership, the key overarching EC principles to consider are purpose and alignment.

The Guiding Principles offer a great template as companies rethink overall pay philiospohy, peer groups and where to position and how to deliver pay. In this video, Scott Oberstaedt provides an example of the Guiding Principles in action with a company undergoing an IPO.