Messrs Ratchet, Ratchet and Bingo

11 May 2007

Congress is looking at potential conflicts of interest at compensation consultants which provide other services to companies. But these consultants aren’t real gatekeepers. They simply rubber stamp the executive club’s everexpanding appetite for pay and perks.

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Henry Waxman, Chairman of the House Committee on Oversight and Government Reform has requested leading firms of pay consultants to disclose their other business relationships with companies. "Almost everyone agrees," said Waxman, "the extravagant increases in compensation makes no sense. The question I'm looking at is whether potential conflicts of interest among compensation consultants and their corporate clients might play a role in some of the irrational compensation decisions."

Jeff Segal reported for this considered view.

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