Bailed-out US firms restructure remuneration

US corporations provided with taxpayer money during the height of the recession have begun to adjust their executive remuneration policies.

Companies including Bank of America, GMAC Financial and Citigroup have started restructuring the compensation policies of their top-earning executives ahead of the pay czar Kenneth Feinberg's imminent publication of new guidelines.

Acting without state guidance on the issue, the organisations are believed to have realigned bonuses with performance, while also allocating a greater percentage of remuneration in stocks and stock options, the Associated Press reported.

However, despite this willingness to implement changes, many of the companies are concerned that the treasury department's master for executive compensation will implement regulations preventing them from attracting the best executive talent.

Gina Proia, vice president of global communications at GMAC Financial, expressed concerns that Mr Feinberg could affect the organisation's performance in difficult market conditions.

She told the Associated Press that the financial services arm of General Motors is already "trying to strike the balance of being able to retain key talent as we execute the turnaround".

The Wall Street Journal reported yesterday (October 6th) that President Obama's pay czar will force the seven bailed-out companies to pay 50 per cent of their executives' salaries in stock.