Tad Folsom, recently appointed chairman of the audit committee Peloton Industries, is preparing for his third meeting with the Board of Directors following the election of its six months earlier, in July 2010. Bill Pelo, Director General of Peloton, is retiring soon, and the council aims to have the right management team in place. Folsom is known that some members of the board want a radical change in the approach to executive compensation Peloton and waiting for input from him. Peloton never options granted before. In general, the practice is not common for medical manufacturing companies, although this is more than that in the general health sector. Folsom remembers his four years as CFO Healthsource Home Care Inc (HHC), multi-hospital and long-term care system, based in the North West. HHC has granted stock options as part of its executive compensation package, and Folsom has witnessed a number of negative changes in behavior as a result. He wants to avoid similar problems in the Peloton, and at the same time, encouraging the adoption of proper alignment of incentives between management and shareholders, which he represents. "Hide
by Paul J Simko, Omar Manejwala Source: Darden School of Business 13 pages. Publication Date: July 12, 2011. Prod. #: UV5232-PDF-ENG
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