How financial executives should be paid? Geithner’s proposals

Treasury Secretary Tim Geithner argued on Monday that government should change executive pay so officials aren't rewarded for taking risks that made the economy to the stage it is at right now.

So far, executives at many financial-services companies have been earning large bonuses by buying or selling mortgage-backed securities, which resulted in companies facing the financial ruin, once the subprime mortgage market imploded.

Geithner stated that the actions being taken by Obama administration on setting limits on the pay of executives at companies receiving government bailout money were not enough. He offered to tie executive compensations to long-term incentives and "say-on-pay," where shareholders would vote on executive compensation packages. 

Nonetheless, Charles Elson, a corporate governance professor at the University of Delaware, said these actions would seize the authority from boards of directors. Banks have also opposed the changes, saying they would limit their ability to attract top talent. Moreover, David DeBoskey, an assistant professor of accounting at San Diego State University, stated "There are all kinds of tricks" that could be used by companies to skirt the limits.