Jeremy Goldstein-Company Growth Incentives

Posted on February 12, 2018

Jeremy Goldstein is a New York City Lawyer who has worked with clients like Goldman Sachs, Bank of American and Verizon. His experience has exposed him to a common issue being considered by large public corporations, whether or not to use ‘earnings per share’ (EPS) as an incentive to motivate the workforce. The whole concept behind the EPS incentive is the belief that as the company grows, employees would also get increased pay, so if the price per share grows, the employee pay check grows. Learn more: https://thebrotalk.com/bro-recommendations/jeremy-goldstein-gives-us-nyc-recommendations/

 

Still, Jeremy Goldstein notes there is no absolute correlation between employee input and share price fluctuation. Opponents of EPS favored compensation think the company’s CEO could positively or negatively affect the outcome of EPS. A CEO and other top executives are in a position where they could chose to skew the results of internal metrics, thereby affecting the share price.

 

CEOs may be motivated to pursue long-term goals instead of short-term earnings per share. The long term goals refer to the company’s expansion in new and more prosperous areas, including capital investments in equipment, buildings, etc. CEOs have to guide that kind of growth, making them essential in any type of pay per performance plan. Jeremy Goldstein believes that tying the long-term goals of the company to the short-term is the better way to reward everyone for performance of the company.

 

The other essential element in this equation is the general workforce. These workers may not be managers, but their work is mandatory and should be rewarded through pay as well as extra incentives. The one thing most employers fail to understand is creativity from the employee saves a lot of money and is worth a great deal. What makes an employee want to add their ideas to help any company they receive a pay check from? The answer is, only one of two things, saving their personal energy or earning more pay. If your employees are being rewarded as the company gains value through an increased share price, they will eagerly part with those creative ideas and the company will benefit.

 

Jeremy Goldstein notes that by compromising and using pay per performance incentives like EPS, as well as making sure CEOs and other executives produce long term results, the company is guaranteed long-term sustainable results. A company that bases pay increases on the overall growth (long-term and short-term) will have longevity, strength and a growing share price.