The following post is from our good friend Joe Scarlett, the non-executive chairman of the board of Tractor Supply Co., the largest retail farm and ranch store chain in the United States. Joe served as the company's CEO until 2004, and more recently launched the Scarlett Leadership Institute here at Belmont. As you can imagine, he knows quite a bit about holding CEOs, and the boards who pay them, accountable for performance.
Joe begins, "We've all read the news articles about greedy CEOs earning huge incomes while other constituents suffer, about signing bonuses without performance clauses or about golden parachutes for the incompetent. We read about outsized egos, free private aircraft travel, club memberships, greed and more greed. It's enough to make one sick. I was the chairman and CEO of a public company for a dozen years and have a simple approach when it comes to executive compensation: Pay me for results. If I produce good results for my stockholders, pay me well. If company performance is fantastic, pay me still more. But if performance is poor, I should suffer just like my employees and stockholders (full article can be read in Business TN Magazine at http://www.businesstn.com/pub/4_8/features/8251-1.html).