The bailout legislation Congress passed last week aims an effective one-two-three punch at executive compensation.

Boards of financial institutions that participate in the bailout program will have to limit executive compensation in a manner that prevents the top five executives from receiving incentives to take "unnecessary and excessive risks that threaten the value of the financial institution during the period that the Secretary [of the Treasury] holds an equity or debt position."

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.