Which one of the following is most likely to align management's priorities with shareholders' interests?
A)increasing employee retirement benefits
B)compensating managers with shares that must be held for 3 years before the shares can be sold
C)allowing a manager to decorate his or her own office once he or she has been in that office for a period of 3 years or more
D)increasing the number of paid holidays that long-term employees are entitled to receive
E)allowing employees to retire early with full retirement benefits

Question

Quizplus · Accepted Answer

Compensating managers with shares that must be held for 3 years before they can be sold aligns management's priorities with shareholder interests because it ensures that the managers have a vested interest in the long-term success of the company. As the value of the shares increases over time, the managers will reap greater rewards, giving them an incentive to make decisions that benefit the company's shareholders. This can improve the overall performance of the company and lead to increased shareholder value.

Which One of the Following Is Most Likely to Align