Comment by ralph84
8 hours ago
If you want to discourage short-term thinking, make the vesting period longer on executive stock grants. Making companies' performance less transparent just opens up more opportunities for insider trading.
8 hours ago
If you want to discourage short-term thinking, make the vesting period longer on executive stock grants. Making companies' performance less transparent just opens up more opportunities for insider trading.
Agree and make it two years for long term capital gains.
> If you want to discourage short-term thinking, make the vesting period longer on executive stock
It’s 3 to 4 years on average. This isn’t relevant to quarterly filing requirements.
Could also price in negative externalities of short term trading with higher taxes for that behavior, nudging the markets to focus on value driving investments rather than speculation
Like short term vs long term capital gains tax rates?
Either that or implement it at the exchange level. Eg. if accredited investors sell a stock in <3 months, you pay X% as a tax at the moment of sale - or maybe different fees for <1 hour, <1 month, <1 year
The problem isn't the executives, it's the boards.
But board members are largely just a proxy for the large shareholders anyway. E.g., short-term investment strategies are not going away.
Working C-levels would almost always much rather take the longer view against the wishes of their boards.
Harder to attract talent though (not saying you’re wrong)