Are the ridiculous salaries of CEOs a logical conclusion of capitalism and the market, or is it an aberration? I don't think I'm going to elaborate any further for now (mostly because I don't feel like it), I'm sure you know what I mean.
Ridiculously Paid CEOs: Part of Capitalism or Aberration?
- Thread starter Defiant47
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CaptainF
The Professional Poster
I seem to recall reading in a financial periodical that CEOs in Europe make much much less than their American counterparts...something like the average being 500,000 to 750,000 dollars per year.
Yup, it's the shareholders' responsibility.
It's part of how the CEO labor market works based on the incentives of participants involved and the means of achieving those incentives.
Some of the highest paid CEO's are actually worth it.
The ones who create the right kind of firm-wide culture, coming from the top.
The ones who the Wall Street analysts love.
The ones who have the right kinds of ties to government.
This stuff is extremely valuable. In the $ trillions.
The ones who create the right kind of firm-wide culture, coming from the top.
The ones who the Wall Street analysts love.
The ones who have the right kinds of ties to government.
This stuff is extremely valuable. In the $ trillions.
Masquerouge
Deity
The problem I have with that is that "shareholders" in that context do not refer to small shareholders like you and me, but to huge investment bodies that have enough votes to actually have an impact.
Lockesdonkey
Liberal Jihadist
How many of these are around?
I know, and I don't care. If I don't like something about the way a company conducts its business, I won't use their services.
GenMarshall
High Elven ISB Capt & Ghost Agent
No, most of them are greedy fat cats.
Lockesdonkey
Liberal Jihadist
I know, and I don't care. If I don't like something about the way a company conducts its business, I won't use their services.
What if the product/service is the best/cheapest out there/the only one you or your company can use (for whatever reason)? Besides, how do they know that it's because of their practices?
(apologies for the /s)
A low number, but some
Masquerouge
Deity
I know, and I don't care. If I don't like something about the way a company conducts its business, I won't use their services.
I understand. It's just that some people, when they hear shareholders, hear "democracy".
Godwynn
March to the Sea
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The investment bodies have incentive to protect their interests as well.
Could you describe to me what you meant? I don't think I fully understand.
Well, I'm speaking entirely hypothetically. If they still sell stuff the cheapest and give me the best value for my money, I don't care what they pay their senior executives.
And to answer your question... well, I pay taxes and I don't always like the job they do and think they're overpaid. 仕方がねぇ.
The shareholders often choose not to hire the guy who will do the job for $1million per year. I think this is a mistake in most cases.
However! Some of these guys actually are very very good at their job, and worth every penny. My CEO has made around $40million per year, every year, for many years now.
As a shareholder, I'm glad we are compensating him properly. He has been worth such sums.
However! Some of these guys actually are very very good at their job, and worth every penny. My CEO has made around $40million per year, every year, for many years now.
As a shareholder, I'm glad we are compensating him properly. He has been worth such sums.
Masquerouge
Deity
Basically my impression is that a lot of people think that "shareholders" are people like you and me, owning a couple of shares, and that as such we can have a say in the remuneration of CEOs. But in fact, while small shareholders may indeed be the most numerous, they probably have an incredibly small portion of the total shares, the majority of which is in the hands of what I called investment bodies by lack of a more proper term: pension funds, investment banks, Icahn, and the like. They control the majority of the shares and as such the pay of the CEO. So, saying the shareholders should control the pay of the CEO gives a false sense of democratic control over the way big firms are managed.
carmen510
Deity
Shareholders decide pay, plain and simple. Of course, I believe that a minimum must be set for pay, otherwise people would starve them. 
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