Seeking the Middle Ground is Attorney Jeremy Goldstein’s Approach to EPS Incentives

New York City-based attorney Jeremy Goldstein received his Juris Doctor from New York University School of Law in 1999. The “Chambers USA Guide to America’s Leading Lawyers for Business” and the “Legal 500” list Mr. Goldstein as an attorney of choice in the field of executive compensation.

 

After 14 years as a partner with the law firm of Wachtell, Lipton, Rosen & Katz he struck out on his own in 2014 becoming a founding partner at Jeremy L. Goldstein & Associates, LLC. With nearly 20 years of experience, he has had a hand in corporate deals involving companies like Goodrich, Bank of America, Miller Brewing Company, Dow, and Verizon Wireless. This is by no means a complete list.

 

Still specializing corporate compensation Mr. Goldstein is a member of the American Bar Association Business Section. He chairs the Mergers and Acquisitions Committee a sub-committee of the ABA’s Executive Compensation Committee. Jeremy Goldstein has been published in multiple legal journals.

 

Fountain House is a non-profit devoted to aiding the mentally ill. For the last decade, Mr. Goldstein has served as Fountain House’s director.

 

Recently, Jeremy Goldstein spoke about Earnings per Share (EPS) as part of executive compensation packages. As an equation, a corporation’s EPS equals profits divided by the number of shares of common stock outstanding. $50 million profit÷25 million outstanding shares=$2.00 EPS.

 

There are those who argue for and against EPS. EPS can influence stock prices and can motivate shareholders to buy and sell stock. Opponents of EPS claim that they create a motive for unscrupulous CEOs to alter numbers to foster the selling of shares. An increase in stock value and shareholder activity can lead to bigger payouts for executives.

 

The case has also been made that EPS removes the incentive to think in the long term. A company that doesn’t think long-term doesn’t grow and prosper. Executives focused solely on their own short-term gain hurt the company and shareholders.

 

Other EPS detractors insist that any incentive program is hurtful to companies. The argument goes that they are in constant flux and therefore unreliable.

 

Studies exploring the effectiveness of EPS have concluded that making them part of employees compensation packages yields positive results for companies.

 

Jeremy Goldstein advocates for the middle ground. First, devise a system to hold the people who run companies more accountable. Secondly, make sure that performance incentives don’t impede the company’s long-term objectives.

 

Visit http://officialjeremygoldstein.com/ to learn more.

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