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Prof. Aswath Damodaran on the relationship between stock price and executive compensation

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Excerpt from The New York Times -- "Aswath Damodaran, a professor of finance at the Stern School of Business at New York University, is among those who think that too many companies rely too heavily on the performance of their shares when computing executive compensation. 'I’m a great believer in markets, but sometimes we need more attention paid to what did this management do to the value of the company and less to what did this management do to the price of the stock,' he said. 'I would like to see compensation systems where managers are rewarded based on what kind of projects they are working on and how big their returns on invested capital are.'”

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