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Assessing Management How To Tell If The CEOs & Directors Are Align To Shareholders

How To Know If The Management Is Aligned With The Shareholders

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Page 1: How To Know If The Management Is Aligned With The Shareholders

Assessing Management How To

Tell If The CEOs & Directors Are Align To Shareholders

Page 2: How To Know If The Management Is Aligned With The Shareholders

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

~ Philip Fisher

Page 3: How To Know If The Management Is Aligned With The Shareholders

Being a CEO Doesn’t Automatically Justify

The Right To A High Pay

Page 4: How To Know If The Management Is Aligned With The Shareholders

A CEO Still HasA Job To Do

Page 5: How To Know If The Management Is Aligned With The Shareholders

A CEO Must Be Able ToDeliver… Bringing The

CompanyTo New Heights & Generate

Healthy Profits To The Company

Page 6: How To Know If The Management Is Aligned With The Shareholders

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 ?

Page 7: How To Know If The Management Is Aligned With The Shareholders

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

With Cold Hard Cash…

Page 8: How To Know If The Management Is Aligned With The Shareholders

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

To Deliver

Page 9: How To Know If The Management Is Aligned With The Shareholders

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

Legacy In TheirFuture Endeavors

Page 10: How To Know If The Management Is Aligned With The Shareholders

So… One Of The ThingsWhen It Comes To Assessing

Management… To Know IfThey Are On Your Side

Page 11: How To Know If The Management Is Aligned With The Shareholders

Is The Way TheyAre Being Compensated

For The Job

Page 12: How To Know If The Management Is Aligned With The Shareholders

So Here Are 2 Things To NoteWhen It Comes To Assessing

If The Management Are Overpaid

Page 13: How To Know If The Management Is Aligned With The Shareholders

First, Is Their Compensation Tied To How The Company

Has Performed ?

Page 14: How To Know If The Management Is Aligned With The Shareholders

If The Company Is not Performing, Is The

ManagementWilling To Cut Down On Their

Own Pocket ?

Page 15: How To Know If The Management Is Aligned With The Shareholders

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

While Generating $10 Million For The Company

Page 16: How To Know If The Management Is Aligned With The Shareholders

Than One That Pays Himself A Million When Company Is

Not Generating Any Profits…

Page 17: How To Know If The Management Is Aligned With The Shareholders

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

Page 18: How To Know If The Management Is Aligned With The Shareholders

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

Page 19: How To Know If The Management Is Aligned With The Shareholders

Salaries & Bonuses Are Not The Only Way The

Management Gets Paid. They Can Be Awarded Stock

Options As Well.

Page 20: How To Know If The Management Is Aligned With The Shareholders

If management are awarding themselves excessive

amounts of stock options compared to the results and

the performance of the company…

Page 21: How To Know If The Management Is Aligned With The Shareholders

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

Page 22: How To Know If The Management Is Aligned With The Shareholders

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

value of outstanding shares

Page 23: How To Know If The Management Is Aligned With The Shareholders

When analyzing, take a look at the number of stock

options as a percentage against the number of

outstanding shares

Page 24: How To Know If The Management Is Aligned With The Shareholders

You’d much prefer a company that has small

percentage versus a company that has issued

stock options worth 10% of outstanding shares

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In A Nutshell...

Page 26: How To Know If The Management Is Aligned With The Shareholders

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

Page 27: How To Know If The Management Is Aligned With The Shareholders

We’ll Try To Avoid ThemAt All Cost…

Page 29: How To Know If The Management Is Aligned With The Shareholders

Questions?Feel free to reach out to us…

Website: http://www.fifthperson.com