 Different management layers and relative performance are the two other issues that a designer can face while designing an incentive system for a given corporate firm. Top management has the capability of impacting share prices in the stock market directly, but unit managers and other business level managers cannot do this. We know that everyone in a corporate firm wants to acquire stock options, but pure of them are willing to stitch from cash bonuses to stock options. In fact, managers like to tie their performance measures with the object that is under their direct control and in exercising their performance, these managers can exceed the expectations. Also another problem in switching from cash bonuses to stock option is that manager cannot spare their human capital from the firm value, so they want to remain on cash bonuses. Middle level managers receive salary plus bonuses, but bonus can be an effective tool only if it is linked with the ranking. This means that the promotion is the differentiator that can be a tool for this purpose because through promotion there is a direct increase in cash salary of a manager. So far as the frontline managers are concerned, any incentive in their pay can only increase a productivity gain for themselves. As a conclusion, we can see that implies performance can be better linked with the value drivers under their own control. The next issue is the relevant performance. In this regard, two phenomena can be discussed regarding the responsibility of the managers. Second phenomena is that managers have full responsibility for all managerial actions they take in order to maximize the shareholders' wealth. This phenomena says that managers can carefully and cautiously take decisions to mitigate risk on the behalf of the owners. This means that managers have given the authority to take decisions to mitigate risk on the behalf of the shareholders. Therefore, managers cannot escape from any responsibility in this regard. The other phenomena says that as a manager is supposed to develop a comparative advantages in the industry in which the manager's firm is working, the manager let's say is not supposed to develop skills on financial hedging. Therefore, in this phenomena, the conclusion is that for certain risks, a manager cannot perform better. Therefore, he cannot be held fully responsible for the actions he takes. Some performance criteria may yield higher compensation in a depressed economy because if a manager performs well individually for his company, then the shareholders will see variations in the stock prices in the stock market. And as a result, this positive variation may enhance the value of the shareholders' wealth. And on the other hand, this relative performance criteria may not well in an economy that is going on prosperously. Finally, we can say that a firm's performance is easily measurable once some external factors are removed from this performance measure and those are the factors that are beyond the control of the management.