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Posted: May 6, 2020
For executives looking to transition to a new organization, hiring an executive compensation consultant may be the key to securing the ideal compensation package. While executive compensation consultants typically service organizations to attract strong executive talent, executives may also leverage the expertise of a compensation consultant in order to ensure that their entry into a new role or organization will be accompanied by a desirable compensation package. Compensation consultants are retained to provide strong guidance when it comes to negotiating all aspects of executive salary and compensation: base salary, base pay increases, incentive pay, and stock options. A skilled executive compensation consultant will be abreast of the trends in market value, as well as the various compensation packages offered by competitors in various industries. Compensation consultants will work with executives to better understand how they are poised in the current market and how they may use their relevant experience in order to justify their desired salary and compensation requirements. According to the Harvard Business Review, there is an emerging new approach to executive compensation that suggests that directors should offer equity to executives based on the achievement of select outcomes that are aligned with the values and mission of the organization. he right compensation consultant may work with executives transitioning to new roles to address tactics for the achievement of these outcomes based on expertise and experience—which may then be relayed to prospective employers in order to gain a competitive edge. Furthermore, compensation consultants are well-versed in the activities of compensation committees, which are comprised of several members of a company’s board of directors who meet routinely to address how executives in their organization should be compensated. By leveraging the knowledge and expertise of a consultant, executives can gain the upper-hand in the negotiation process and secure an ideal outcome. In addition to providing expertise in the realm of salary negotiations, executive compensation consultants are able to assist with navigating agreements regarding the terms of employment. Prior to on-boarding, new executives are often expected to sign employment agreements, or binding contracts that outline the details of the compensation package—inclusive of benefits and potential for bonuses. Most importantly, these agreements outline the terms and conditions of employment and often contain clauses regarding the renewal of employment. Commonly, contracts contain a clause that dictate that the contract will automatically renew on an annual basis if notice of termination is not provided by either party. This type of clause is included for the purpose of protecting both parties from any administrative errors that may complicate the creation or signing of a new agreement. Experienced and effective compensation consultants can help prospective executive level employees to ensure that the employee agreement is fair and in keeping with the employee’s best interests. A skilled consultant may thoroughly author or examine an existing agreement to ensure the executive is not subject to discretionary employment decisions and is protected in the event of organizational changes such as restructuring of management. Every executive navigating the job market in search of a perfect fit stands to benefit from hiring an executive compensation consultant. In addition to ensuring executive pay is appropriate, compensation consultants will ensure that employment agreements are favorable and that incentives beyond base pay will carve a path for successful career growth and desirable outcomes. To learn more about maximizing executive salary, visit our Contact Page, or contact us directly by email at fglassner@veritasecc.com or by phone at 415-618-6060.
