First, the fact that leaving the company usually meant cashing in one s pension at a discount increased worker loyalty. Second, complaisant accountants optimistic assumptions about returns on pension reserves, together with large firms greater risk bearing capacity, brightened the financial picture that companies could report to investors.

The length of this period should be fixed, and should not depend on actions or conditions that are at least partly under executives control. By contrast, prohibiting executives from cashing out shares and options until they leave the firm would provide executives who have accumulated shares and options with a large monetary value with counter productive incentives to depart.