Disney heir calls on company to give 50% of exec bonus to lowest-paid employees
edition.cnn.com
edition.cnn.com
Just because someone is inherently wealthy doesn't mean their opinions on operations of a given company, that happens to carry their name, is wrong.
When any company shuts down, the median employee is not blamed it is the CEOs and executives who are blamed.
Companies do not pay CEOs for the hours they work, they pay them to take critical decisions.
When Papa John's founder said a bad word the sales dropped. Any executive could cause a similar reaction from the public. You want them to be paid well enough that they never cause such problems.
The rest of it? yeah, requires some technical knowledge, some interpersonal skills. But no less work or stress than say a line manager or a senior employee.
Its hasn't been considered reasonable to earn 100's of thousands of times more than most people. That's kind of the definition of excess, and is used throughout history to illustrate societies gone haywire (despot kings, religious wealth in the presence of poverty etc).
There are literally thousands of people who would line up to make those critical decisions. They don't earn that much because of the market. CEOs earn that much because the folks at a company that can write checks, write them to each other.
I work in finance and your buddy buddy old boys club isn’t true. Shareholders want as much money as possible and the relationship between them and management is often antagonist: many a CEO are laid out to dry every year by investors.
As such, there’s only one reason why Bob Iger gets paid so much: because he’s generated tremendous value for shareholders over the years and the shareholders want to incentize him to keep generated value.
Generating value for the shareholders is a job, and can pay like any other job. The reasons compensation for that has jumped up an order of magnitude has more to do with tulips.
CEOs (and many other execs) don't have a lot of downside. They usually have a contract which guarantees their pay (short of malfeasance), and they tend to get big bonuses.
Upon mergers, some do get cut, but often with golden parachutes. The working stiff gets laid off, and if you're, say, a machinist in Cleveland, good luck finding a decent job again. If you're an exec, you do a quick stint in consulting to land on your feet.
Executive decisions are not hard or stressful enough to justify that pay. It may be tough to lay people off, but it's a hell of a lot more stressful to be laid-off. Generals, Colonels, Majors, and Captains send people into harms way (literally into gunfire), which is way tougher than anything a CEO will ever do, yet they aren't paid for their "hard decisions".
Can a good CEO make a huge difference to a company? Absolutely! But the asymmetry is also that a bad CEO doesn't experience a similar downside (being fired after you've made ten million dollars is not a hardship!).
Maybe if C level executives / board members faced the same sort of consequences for their poor decisions but that doesn't happen as often as it should. Leadership should face the brunt of the cost for their poor decisions instead of letting others take the hit for them.
Just like I don't think anyone should be taxed at above 50% of their income, I also don't think anyone within a single company structure should make more than 100X anyone else. I don't think that companies should be forced to do so, but there's absolutely NOTHING wrong with shaming those that do.
But it’s the CEOs who get the golden parachute. I don’t hear anyone here saying “I would prefer to have a mediocre wage because I am so afraid of being blamed for my mistakes”.
That's probably the one.