Searching Pondering Equity-Based Long-Term Incentive Plans on page 11

Beyond Base Pay: Achieving Pay Equity Across Total Rewards On Demand until May 04, 2026 Brought to you by Facebook Twitter LinkedIn As global pay equity and transparency requirements expand, organizations must look beyond base salaries to ensure fairness across the entire total rewards package.

There are many effective forms of LTIs that family businesses can choose from: ;Real equity is suitable for companies willing to share ownership with non-family executives.; ;Phantom equity mimics equity value growth without conferring actual ownership.; ;Stock appreciation rights (SARs) provide cash or equivalent payouts tied to growth in company valuation.; ;Long-term cash plans deliver performance-based payouts over multi-year periods without equity dilution.; Whichever LTI plan design is selected, the board must evaluate plan objectives and assess how well the plan aligns with business strategy and company culture.

;Administering and Evaluating the Plan: Sales compensation plans should include such factors as base salary ranges, a mix of base salary and incentive earnings and total cash compensation based on achieving measurable business objectives.

In terms of how to approach determining compensation, no single solution for every organization, but purely market-based structures should be abandoned.

The current race for talent has created pay inequities between newly hired and long-term experienced employees and between subordinates and their supervisors.

Building the Right Compensation Package In addition to the standard salary and performance bonuses, Canavan said the building blocks should be: retention incentives, which organizations can address through real or “phantom equity” (a type of compensation award that references equity, but does not entitle the recipient to actual ownership in a company); a long-term cash bonus plan; or split-dollar life plan, which allows the sharing of the cost of a premium for a permanent life insurance policy.

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The Journal of Total Rewards First Quarter 2023 | Volume 32 | No. 1 In this issue: retiree knowledge transfer, Ohio workers’ comp pilot, more ESG metrics in executive comp, long-term care and CalPERS, employee trust for benefits Cover Story Journal of Total Rewards Article Tapping into Retirees to Bolster Knowledge Transfer The knowledge transfer between retirees and their remaining employees offers a unique opportunity to retain knowledge.

The unadjusted pay gap is partially a result of pay equity but even more so, it’s a result of opportunity equity, which includes promotion equity, retention equity and performance equity.

The Power of Non-Monetary Incentives While financial rewards can certainly serve as a motivator, they’re only one piece of the equation — and organizations have a wealth of non-monetary incentives they can tap into