The Troubles with EPS and the Simplified Solution of Jeremy Goldstein

When it comes to the compensation structuring and performance review for senior executives including CEOs, most of the companies face a dilemma. It is none other than whether to include Earnings per Share metric to be included in the employee incentive factors or not. It is largely due to the varied results EPS produce in various industries and based on the approach of people towards it. Recently, Jeremy Goldstein, the prominent compensation expert from New York City, explained various aspects of EPS, different contradictory thoughts, key challenges with the current system of EPS, and his solution for an efficient employee incentive administration.



Goldstein thinks that EPS is a good metric when it comes to handling the employee incentives. It is also one of the biggest decision-making factors for the shareholders as it helps them to buy or sell the shares according to the EPS value. Many studies in the recent years supported the fact that including EPS in the pay structure helped a large number of companies to be more successful. In general, it gives a notion that including EPS in business strategy is a great idea. However, Jeremy Goldstein says that the trading of shares and its competitive nature provide the companies to make undue advantages.



The critics of EPS argue that it generates favoritism and assigns significant power to CEOs, leaving collective control a history. The added powers can prompt the CEOs to skew the market results for their benefits. Also many believe that such programs are only focusing on short-term benefits by disregarding the long-term growth strategy and goals of companies. All these unfavorable developments are actually risking the investors at the end and can even lead to regulatory issues and hefty fines. Jeremy Goldstein thinks a compromised strategy in using EPS is the best possible way to sort it out.



He suggests that the pay per structure be linked to the long-term goals of the company. Additionally, the executives should be liable for their actions to make them more responsible in exercising their duties. Jeremy Goldstein thinks that such a pay per performance structure can ensure sustainable, long-term, and steady growth for companies that can also ensure some good news for the investors.



Jeremy Goldstein has a few decades of expertise in compensation structuring for senior leadership of various companies. He is a leading attorney in New York City with a focus on pay structuring and corporate compliance. Goldstein has served many large banking firms, oil companies, telecommunication enterprises, stockholder firms, and more.



He is also an authority in mergers and acquisitions and helped many Fortune 500 companies to complete significant transactions, hassle-free. Some of his clients in the area include Duke Energy, United Technologies, Goldman Sachs, The Dow Chemical Company, NYSE Group Inc., Verizon Wireless, and more. Learn more: