Leadership Matters: Semler Brossy on People, Pay, and Performance
Aug 12, 2026 · 37 min · 9 segments
Austin Vanbastelaer, partner at Semler Brossy, joins the show to unpack how to design executive incentives when there's no template to follow — mid-transformation, pre-revenue, or in the middle of a…
Austin VanbastelaerGuestPrimary HostHostNicoHostCo-HostHostWe talked earlier about some of the changing forces and the velocity of change that's happening, um, with companies.
So what about when companies are facing valuations that, um, move for reasons that have nothing to do with management? How do you, how do you keep management motivated and focused and engaged in that environment?
Um, this, this reminds me a little bit of the, like, heads I win, tails you lose type of framework.
[laughs] So, uh, and I think investors rightfully have very different perspectives on this.
So there's one camp of investors that would say if, uh, you know, your trading valuation is not really in your control because of all these exogenous things, then maybe you shouldn't be paid on TSR stock price or something like that.
Um, but you have a, a very large and vocal group of investors that would say, "Actually, it's the perfect time to measure TSR or stock price." How can you figure out a way to take control of your valuation and increase shareholder value over time? I don't know...
You know, I don't have a personal vendetta in this argument [laughs] so I think it's very company dependent on, uh, which argument kind of resonates the most.
But in those cases, if you're not gonna, if you're not gonna go down the path and say, "Actually, it's the perfect time to use TSR-"
Mm-hmm.
The second question it would introduce to me is, are you better off having the underlying vehicle in your long-term incentive program be options or shares? 'Cause performance options could be a very interesting, uh, vehicle in that type of setting, where you're saying, "Hey, you don't have to figure out how to get a higher valuation multiple tomorrow, but you better figure out how to do it over a 10-year period."
Mm-hmm.
We talked earlier about some of the changing forces and the velocity of change that's happening, um, with companies.
So what about when companies are facing valuations that, um, move for reasons that have nothing to do with management? How do you, how do you keep management motivated and focused and engaged in that environment?
Um, this, this reminds me a little bit of the, like, heads I win, tails you lose type of framework.
[laughs] So, uh, and I think investors rightfully have very different perspectives on this.
So there's one camp of investors that would say if, uh, you know, your trading valuation is not really in your control because of all these exogenous things, then maybe you shouldn't be paid on TSR stock price or something like that.
Um, but you have a, a very large and vocal group of investors that would say, "Actually, it's the perfect time to measure TSR or stock price." How can you figure out a way to take control of your valuation and increase shareholder value over time? I don't know...
You know, I don't have a personal vendetta in this argument [laughs] so I think it's very company dependent on, uh, which argument kind of resonates the most.
But in those cases, if you're not gonna, if you're not gonna go down the path and say, "Actually, it's the perfect time to use TSR-"
Mm-hmm.
The second question it would introduce to me is, are you better off having the underlying vehicle in your long-term incentive program be options or shares? 'Cause performance options could be a very interesting, uh, vehicle in that type of setting, where you're saying, "Hey, you don't have to figure out how to get a higher valuation multiple tomorrow, but you better figure out how to do it over a 10-year period."
Mm-hmm.
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