Because they are getting a commission equal to one monthly wage of the successfully placed executive they will tend to quote a level of compensation higher than the market s. A closely similar method is to follow what other, comparable, firms, are offering their position-holders. Any compensation that he receives above this level is evidently a hidden dividend. The arbitration can be carried out directly by the market or by select specialists. There are, however, more direct approaches.
Some solutions are performance related.
This, really, is the hidden dividend, disguised as a salary. The remaining part of the compensation package will be proportional to some performance criteria. The second partner supervises and manages activity B, which yields to the company BB in revenues and BBB in profits. Both will receive an equal base salary . A recalculation of the compensation packages will be done quarterly to reflect changes in revenues and in profits.