Executive Compensation

Executive Compensation Executive compensation should be “pay for performance.” The direct link between pay and the company’s profitability is an important factor. It can either motivate an executive to work harder for the company or to work against the company. Borders Group has established a Compensation Committee, comprised of two independent, non-employee members of the Board of Directors without interlocking relationships. This committee ensures that executive compensation policies and practices in place enable Borders …

…a proposal to amend Borders’ by-laws requiring the five most highly compensated officers of Borders to be full-time employees. DiRomualdo, Chairman of the Board, and Mrkonic, Vice Chairman, are required to devote only 50% of their time to Borders. Strategic Initiative also states that the greater than $1 million possible compensation for these individuals is excessive for part time individuals. Compared to their main competitor, Barnes and Noble, Borders Group executives own considerably less stock. (Finish Comparison)