Thought Capital

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Beyond the Trillion-Dollar Question: What Tesla's Mega Grant Means for Canadian Boards

Tesla’s board proposed a $1 trillion incentive for Elon Musk, arguing his leadership is essential for the company’s future. This article urges Canadian boards to balance bold executive pay with governance, cautioning that shareholder value alone shouldn’t justify extreme compensation. It highlights the need for rigorous processes and proportionality in designing CEO incentives.

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Defined Benefit vs Defined Contribution Pension Plans 101

Executive pension plans in Canada have traditionally been shaped more by legacy practices than by strategic intent. Historically, defined benefit (DB) plans dominated the landscape, offering predictable retirement income based on formulas tied to salary and years of service. However, evolving disclosure requirements and the growing financial burden of DB liabilities have prompted many companies to reassess these arrangements. Today, defined contribution (DC) plans are gaining traction, especially among TSX60 companies, reflecting a broader shift in executive compensation toward long-term, equity-based incentives.