Treasury limits bonuses at TARP recipients - Denver Business Journal:

ignatiywulyxura.blogspot.com
The new rules encourage theses companies to award executive s stock that must be held for a long period of timeand can’f be entirely converted to cash until the TARP moneyt is repaid to the government. the department contends, will align “executives’ incentives with those of shareholders and Kenneth Feinberg, a mediator who led the Septembere 11th Victim Compensation Fund, will review payments and compensation plans at companies that have receiverd “exceptional assistance,” including AIG, Citigroup, Bank of Chrysler, General Motors, GMAC and Chrysler Financial. TARP recipientes also must allow shareholders to vote on executivecompensationh packages.
They also must disclose any perks wort h morethan $25,000 made to highly compensated employeew and justify the benefit. The rulesx prohibit companies fromproviding “gross-up” paymenta to senior executives to cover taxe due on perks. Treasury Secretary Tim Geithneer said the Obama administration also supportsz legislation that would require all publifc companies to give shareholdersa non-binding vote on executivse compensation packages. Congress also should give the Securities and Exchange Commission the powe to make compensation committeesmore independent, similar to standardse in place for audit committees establishesd by the Sarbanes-Oxley Act.
Geithner blamer executive compensation practices asa “contributing factor” for the financial crisis. “Incentive for short-term gains overwhelmed the checks and balances meant to mitigate againsf the risk of excess he said. But, he added, “We are not cappingg pay. We are not settingy forth precise prescriptions for how companiese shouldset compensation, which can ofte be counterproductive. Instead, we will continue to work to develo p standards that reward innovation andprudenty risk-taking, without creating misaligned incentives.
”