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Thomas, Randall S. --- "Lessons from the Rapid Evolution of Executive Remuneration Practices in Australia: Hard Law, Soft Law, Boards and Consultants" [2012] ELECD 615; in Thomas, S. Randall; Hill, G. Jennifer (eds), "Research Handbook on Executive Pay" (Edward Elgar Publishing, 2012)

Book Title: Research Handbook on Executive Pay

Editor(s): Thomas, S. Randall; Hill, G. Jennifer

Publisher: Edward Elgar Publishing

ISBN (hard cover): 9781849803960

Section: Chapter 17

Section Title: Lessons from the Rapid Evolution of Executive Remuneration Practices in Australia: Hard Law, Soft Law, Boards and Consultants

Author(s): Thomas, Randall S.

Number of pages: 28

Extract:

17 Lessons from the rapid evolution of executive
remuneration practices in Australia: hard law, soft
law, boards and consultants
Randall S. Thomas1


1 INTRODUCTION

Executive remuneration is a hot topic in US corporate governance circles today. Hardly
a day goes by without a prominent press report about the details of a particularly large
compensation or severance package. Often the reporter's theme is that American inves-
tors are at the mercy of an out-of-control process and that the legal and corporate
governance systems in this country have completely broken down when it comes to
CEO pay. For that reason, it is important to carefully examine the legal and corporate
governance systems in other industrialized, wealthy nations to see how they have
treated executive pay in the last decade, to determine if there is a better model
available.
Australia provides a particularly interesting comparison to the American system.
Australia is one of the few western nations that was largely untouched by the global
financial crisis of 2008­09, with its industrial and mining base left unscathed and the
Australian dollar leaping impressively in value. Economic news has been largely good
for the local economy. Nevertheless, the country chose to closely scrutinize executive
remuneration and to enact many changes to its executive pay system that increased inves-
tor involvement in the process, some of which have been copied in the Dodd-Frank
legislation recently passed by the US Congress.
This chapter gives a dynamic overview of the key Australian corporate ...


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