Cons on Executive Compensation

Cons on Executive Compensation - that the CEO has and they...

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Cons on Executive Compensation - CEO’s salaries ion 1992 were 82 times the salary of a blue collar worker, in 2004 these compensations were 400 times the amount of the average blue collar worker. - The average pay for a CEO is $14 million dollars a year, a study was done by some Standford Law and Business faculty and they found that the high salary pay does not mean that the CEO is actually competent on work that he or she does. This also does not mean that they are the best person for the job. - In large companies it is not seen that the high salaries actually receive the right return of work because of the constraints on the CEO but then in small companies CEO’s who made a large sum of money actually benefitted the company because of the power
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Unformatted text preview: that the CEO has and they appear to do better because there is more incentive. -The excessive pay is seen as a unethical and corrupted behavior because the CEOs are seen to be focusing more on the greed for the money and take larger risks instead of focusing on the health of the company and the various stakeholders. -The pay of some CEOs does not represent the work that is being done. This was seen in the economic collapse because CEOs were offered very high compensation packages also known as a golden parachute for the terrible job they had done in running the company. They had run the companies into the ground but still received large amounts of money to leave their role as CEO....
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