This essay proposes a framework for ESG executive compensation. It includes and integrates the common use of ESG Targets with the demonstrated advantages of Relative Performance Measurement, the credibility of ESG Rating Agencies, and the judicious use of after-the-fact Performance Evaluations....

While the current financial crisis has challenged nearly everyone from management to media, it has exposed some fundamental flaws in management pay. In recent years, bonuses have been too high in up-cycles and they now risk being too low in the current downturn. Adopting an investor's...