DESIGNING PERFORMANCE FOR LONG-TERM VALUE: ALIGNING BUSINESS STRATEGY, MANAGEMENT STRUCTURE AND INCENTIVE DESIGN

Published in the Handbook of Board Governance - 2nd Edition - 2020
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Summary

How should performance and success be measured in public companies? Why are total shareholder return and earnings per share not the optimal performance metrics for management incentives to align with long-term shareholder value?

What key performance metrics should management be measured on to align the business strategy and value drivers of both the current and future value of the enterprise?