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Basics
Basics of Executive Compensation
What Is Executive
Compensation?
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What Is Corporate
Governance? Pay Packages Explained
Corporation Management:
The Basics Executive pay packages differ substantially from typical salaried or hourly employee compensation
because unlike typical employee pay, the vast majority of an executive's pay is contingent compensation
Glossary
and structured only to reward the executive for actual, positive company performance and growth in
shareholder value. To this end, executive compensation packages typically utilize six distinct
compensation components:

Base Salary

Short-Term Incentive

Long-Term Incentive

Employee Benefits

Perquisites

Severance/Change-in-Control Payments

A company's Compensation Committee will structure their executive's pay packages utilizing a
combination of the above components to help achieve the company's Pay for Performance and/or
Retention objectives.

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