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End salary-stock options links: ASIC

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    730 Posts.

    Interesting article just out on ABC.

    Link to Article

    Posted: Wed, 17 Jul 2002 8:08 AEST

    End salary-stock options links: ASIC

    The Australian Securities and Investments Commission (ASIC) is urging the Federal Government to put an end to the linking of executive salaries to stock options.

    ASIC would also like to see its policing powers increased.

    ASIC chairman David Knott says the practice of linking executive salaries with stock options leads to an unhealthy preoccupation with share prices.

    He cites the collapse of One.Tel as the best recent example of how market-linked remuneration can coincide with poor management and has called on the Government to put a stop to it.

    "The disproportionate inclusion of options in a CEO's remuneration package is an affront to the general body of shareholders and the principles of good governance," Mr Knott said.

    Mr Knott has also suggested a radical plan to increase ASIC's powers to police business in the wake of falling investor confidence, including the power to enter and seize records without cause.


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