No Smoke Or Mirrors At Union Carbide
Senior writer John Byrne expressed some good ideas about designing incentive compensation programs for executives ("Smoke, mirrors, and the boss's paycheck," Management, Oct. 13). However, a more thorough reading of the material that he was sent explaining Union Carbide Corp.'s earnings-per-share compensation program, along with the report on executive compensation in our proxy statement, ought to have made it clear to him that we have just such a program.
We agree that compensation should be based on "goals set against an industry peer group." That is why, several years ago, Union Carbide's board adopted a plan that makes competitive performance measures overwhelming factors in the formula directors use to determine variable compensation.
As one of the participants in the program, I can assure you that the incentive opportunity and pay-at-risk elements both strongly reinforce alignment of management's actions with the interests of the owners of our shares.
Joseph S. Byck
Union Carbide Corp.