The board of directors of a corporation feels that senior management deserves compensation for their contributions to achieving the company's objectives. The board of directors decides whether or not to provide bonuses based on share price rises at the end of each year. Managers will get bonuses in the form of shares, which they may either retain or sell. What effects would putting in place such a bonus scheme have?

Fundamentals of Information Systems
9th Edition
ISBN:9781337097536
Author:Ralph Stair, George Reynolds
Publisher:Ralph Stair, George Reynolds
Chapter2: Hardware And Software
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The board of directors of a corporation feels that senior management deserves compensation for their contributions to achieving the company's objectives. The board of directors decides whether or not to provide bonuses based on share price rises at the end of each year. Managers will get bonuses in the form of shares, which they may either retain or sell. What effects would putting in place such a bonus scheme have?

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