Publications
Publications
- September 2003
- HBS Case Collection
Executive Compensation at Reckitt Benckiser plc
By: V.G. Narayanan, Krishna G. Palepu and Lisa Brem
Abstract
Investors felt betrayed by the increasingly lucrative pay packages awarded to CEOs and other top executives at multinational companies. Yet, board members charged with adequately rewarding executives were forced to compete with rising packages of salaries and stock options. Bart Becht, CEO of Reckitt Benckiser, the Anglo-Dutch manufacturer of cleaning products, was the United Kingdom's highest paid CEO in 2003. With shareholder protests looming at its annual meeting, should the board reconsider Becht's pay package or ride out the storm? Examines the issues facing board compensation committees when trying to design remuneration packages that will keep CEOs performing and meet shareholder goals. Discusses the viability of stock options, proper balance between variable and nonvariable pay, setting effective performance targets, and how rising U.S. pay affects global companies.
Keywords
Design; Stock Options; Investment Activism; Corporate Accountability; Compensation and Benefits; Employee Stock Ownership Plan; Management Teams; Business and Shareholder Relations; Consumer Products Industry; Netherlands; United States
Citation
Narayanan, V.G., Krishna G. Palepu, and Lisa Brem. "Executive Compensation at Reckitt Benckiser plc." Harvard Business School Case 104-006, September 2003.
About The Authors
