Description: With shareholder pressure on the uptick, the latest survey of salaries among Canadian bank executives shows that overall compensation is down. Board’s may be looking at performance benchmarks more closely, accounting for some of the reduction in salary. But it is possible that the fact that four of the five CEO’s at the largest Canadian banks are new to the job may be having some influence as well. Increasing public pressure may also be at work here.
Date: April 11, 2016
1) Which factor do you think has had the most influence on these lower salaries for bank executives?
2) What are some things accounting theory tells us about setting compensation packages for executives?
3) Imagine yourself some years from now as a successful accountant who has been asked to join a board for a major bank. Further, you have been appointed to the compensation committee that sets the compensation for executives. What are two or three of the main things you have learned during your university training that you would like to share with the committee?