Paying Our CEOs
Since the 1980s, the salaries of American executives have increased exponentially. With income inequality growing more pronounced, this development has become a source of contention. Some argue that it is a corporation’s prerogative to pay its CEO what it wishes, and that high CEO salaries are a very effective method of motivating the entire workforce. Others feel that such high salaries are not commensurate with a CEO’s impact on a company’s bottom line, and point out that these high wages are rarely cut when corporations fail to perform.
 
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2.15.08
| 07:05 PM - |
Its not about the #s, its about the value.
meatandpotatoes - I think your math is wrong on celebrities, first off. Tom Cruise made a lot, but its peanuts compared to the Mariah Carey dynasty.
So Price got $50mm over 5 years (most of which was in stock that is worth about half what it was valued), ranked 59th among CEOs, leading a company with mkt cap of $125bln. Your telling me 2 of Tom Cruises movies are of the same value? You cant run a company from a script, and Tom can rattle off 2 movies in 2 months of work. I dont know who received $160mm, but its clearly a 1 off case, and its representative of not just the value of their contract being cut short but also of accumulated stock holdings which can drop in an instant. |
| 06:39 PM - |
Not a whole lof ot meat..
elbie - Comparing (and justifying) with the celebrity example doesn't make sense - just because celebs are overpaid, doesn't affect this discussion. Not only that, CEOs of big companies are compensated on a level that even the most A list celeb can't imagine. Imagine getting fired and getting $160 compensation package.... FOR GETTING FIRED! Tom Cruise, in his i'm-not-about-to-cut-my-ear-off days was making $20 million for a movie.
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| 05:21 PM - |
celebrities
meatandpotatoes - CEOs are like celebrities, but when they F up, they dont just ruin their lives and endure a bit of embarrassment (Ashely Simpson anybody?), they ruin the lives of their employees, share holders, customers, and the economy. Want accountability? Look at what happened recently to Prince, O'Neil, Cayne, etc. They didnt even know what securities the bank was holding (how could they?), but they were ousted just because they were on top.
Anyway, I think their pay is just, especially when you consider the millions our modern day pop artist make for turning out total crap. |
| 04:49 PM - |
That's right
alexva - Pay them what they deserve. In today's competitive market for top talent pay is the best way to attract and retain the best.
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| 04:46 PM - |
Listen to the market
yeskey - if these companies want to pay their leaders millions and millions, who cares? if the board of a public company is willing to agree, and presumably the shareholders are down, then where on earth is the harm?
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| 03:00 PM - |
Arms Race
endless - CEO's are paid their fair market value. The problem is that a CEO is worth so much to a company. A $50 million paycheck is nothing for a billion dollar company. If that CEO makes the difference between putting a company on a good track or not, there's no question of whether it is worth it. So the effective CEO has become extraordinarily valuable. A rare and highly valuable commodity among organizations with limited price sensitivity will make for a high price. It's that simple. Now the only question is when they will start holding CEO's accountable.
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