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POKING HOLES IN THE GOLDEN PARACHUTE resigns with good reason. The double-

news, they should

Street movement took to the streets of

trigger, or golden parachute, package occurs

pair a single-

lower Manhattan in 2011, in part to lambast

within a certain period of time after the sale

trigger severance

corporate CEOs for purported greed. Their

or acquisition of a company. The executive

agreement with a

argument: These chief executives are

receives compensation for the same reasons

highly variable CEO

overpaid, blessed with “golden parachute”

outlined above.

pay structure.

Protesters in the so-called Occupy Wall

clauses and devoid of transparency.

“Those ‘causes’ or ‘reasons’ are different

In view of the very

from company to company and often

public criticisms of

of accounting at Marquette, has been study-

poorly defined,” Ling says. “The perception,

CEO compensa-

ing the interplay among CEO severance

and often the reality, is the CEO benefits

tion, severance

packages, salary and transparency. And her

greatly from these agreements.”

and transparency,

Dr. Qianhua “Q” Ling, assistant professor

findings could help shape how corporate

Ling’s research found that CEOs who

these findings highlight

boards approach these compensation and

have single-trigger severance packages

important strategies that corporate boards

governance issues.

are more prone to conservative financial

can use to more ethically guide their

reporting and they tend to disclose bad

organizations, Ling says.

In a paper slated to be published in 2012 by the Journal of Accounting,

news sooner. From the boards’ perspective,

“Quite simply,” she says, “I’m interested

Auditing and Finance, Ling examines the

Ling says, this is the silver lining of having a

in how governance affects information and

association between pre-negotiated (or ex

severance agreement. “This association

how information affects decisions.”

ante) severance agreements and the timely

remains positive in the CEO’s last year of

Ling’s next project is no exception.

disclosure of bad news to governing boards

tenure where performance is poor,” she

She’s now examining the link between

and shareholders. She looked at “single-

adds. “And the association is stronger among

chief executive compensation and

trigger” and “double-trigger” severance

CEOs with a highly variable pay structure.”

financial performance of nonprofit

packages. According to Ling, the former

Ling suggests that if boards want to

entitles a CEO to compensation if employment

capitalize on the impact severance agree-

is terminated without cause or the CEO

ments have on the early disclosure of bad

human services organizations. — CS

ENGINEERING SAFER ROADS There are more than 11,000 miles of state roads in Wisconsin, and Dr. Alex Drakopoulos has studied all of them. It’s all part of the research the associate professor of civil,

Drakopoulos also conducted research on the national standards that govern traffic signal indications and road markings. Results from this research, with additional findings from other investigators,

construction and environmental engineering has guided during his

are now included in the Manual on Uniform Traffic Control Devices,

19-plus years at Marquette, hoping his findings help federal and

a publication that sets nationwide standards for traffic agencies.

state transportation agencies implement safety changes for roads. His latest work includes a federal grant to analyze the effect of trucks on congestion. “A truck accelerates much slower than a passenger car. So as the

Another one of his projects was the first U.S. installation of special pavement markings that were used in Japan to slow down drivers before dangerous turns. These markings, installed by special permission from the Federal Highway Administration

speeds drop when you have congestion — perhaps it’s a work zone

at a Milwaukee freeway location, are now widely used across

or peak-hour traffic — you’re going to have the trucks create a lot

the country.

of gaps ahead of them,” he says. “This certainly is going to impact congestion.” And when there’s congestion, there’s driver frustration. When there’s driver frustration, there are accidents. Drakopoulos hopes his data will provide new information about how to make congested highways that carry a lot of trucks operate more safely and efficiently.

Even though he says his research “focuses on things that people don’t ordinarily notice on a daily basis” — a blinking red light bulb in a traffic signal or lines etched on the pavement surface, for instance — he knows small findings can mean big change. “If you have the chance to improve policy because of your findings, it is a great help to people who need it,” Drakopoulos says. — BDJ Marquette University

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