How To Know If The Management Is Aligned With The Shareholders

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Assessing Management How To

Tell If The CEOs & Directors Are Align To Shareholders

“Does The Company Have A Management of UNQUESTIONABLE Integrity…”

~ Philip Fisher

Being a CEO Doesn’t Automatically Justify

The Right To A High Pay

A CEO Still HasA Job To Do

A CEO Must Be Able ToDeliver… Bringing The

CompanyTo New Heights & Generate

Healthy Profits To The Company

As An Investor, Would You Want To Put Your Money

With A Company That Doesn’t Perform But Pays It’s Directors Millions Of

Dollars In Remuneration ?

A Good Management,Doesn’t Just Settle For Track Records Or Fill Their Pockets

With Cold Hard Cash…

But Rather…Focusing What They Are Meant To Do As A CEO…

To Deliver

Only Then Will Their Remuneration Be Fully Justified & Leave A True

Legacy In TheirFuture Endeavors

So… One Of The ThingsWhen It Comes To Assessing

Management… To Know IfThey Are On Your Side

Is The Way TheyAre Being Compensated

For The Job

So Here Are 2 Things To NoteWhen It Comes To Assessing

If The Management Are Overpaid

First, Is Their Compensation Tied To How The Company

Has Performed ?

If The Company Is not Performing, Is The

ManagementWilling To Cut Down On Their

Own Pocket ?

Obviously, As An Investor, You Rather Invest In A CEO That Pays Himself A Million

While Generating $10 Million For The Company

Than One That Pays Himself A Million When Company Is

Not Generating Any Profits…

It Tells You A Lot About ThatPerson – If He Is In This For Himself Or The Company.

Second: Is The Management Granting Themselves With Excessive Stock Options ?

Salaries & Bonuses Are Not The Only Way The

Management Gets Paid. They Can Be Awarded Stock

Options As Well.

If management are awarding themselves excessive

amounts of stock options compared to the results and

the performance of the company…

It is something you need to sit up and take notice of.

When these stock options are exercised, new shares are issued and dilutes the

value of outstanding shares

When analyzing, take a look at the number of stock

options as a percentage against the number of

outstanding shares

You’d much prefer a company that has small

percentage versus a company that has issued

stock options worth 10% of outstanding shares

In A Nutshell...

Any behavior that shows that management is more

interested in being rewarded handsomely regardless is a telltale sign that they put

their self-interests over their shareholders

We’ll Try To Avoid ThemAt All Cost…

Questions?Feel free to reach out to us…

Website: http://www.fifthperson.com

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