There's a structural power relationship in play. Monarchs play a fairly unimportant role these days but many countries still have them and compensate them handsomely.
CEOs are structurally capitalist monarchs. Sometimes it's even a hereditary position. They even do the corporate equivalent of court and heraldry stuff.
They're compensated not based on competency but instead, like every other job, via social arrangement.
If you don't think that's how salaries work, you're getting underpaid.
"form of government in which one person or a small group possesses absolute power without effective constitutional limitations."
Companies are *governed* by unimpeachable, unelected, all powerful groups that in practice treat employees like literal slaves (you don't have to be chattel or physically abused to be a slave). However because almost all employment agreements are exactly the same, it's the same law firms and laws that these orgs use over and over, essentially all corporations have colluded for this structure and type of employment power dynamic.
After all why wouldn't they, the "American dream" is to become a dictator in the capital class, free from exposure to dirty labor.
How do I know this?
I've been a CEO dictator for a company before and hated the structure. Now I'm trying to create a non-stock cooperative and all I get is head scratching from banks, lawyers etc... who have NO CONCEPT how to organize something that isn't in the boilerplate Delaware equity dictatorship construct.
(1) Instead of saying a representative can't represent more than 10-100 people, have you considered making it a percentage of the membership? Making it a hard number seems potentially inflexible as the organization grows.
(2) Making it a requirement that the CEO be a part of the organization for 4 years before running would imply that either the first CEO didn't have to meet such criteria, or that there is no CEO for the first 4 years.
Very curious to follow your journey!
In both of those cases the spirit it to build structural breakpoints in such that it’s harder to accelerate than it is to stop. In my experience speed is what kills ethics.
So my guess is that we’ll be without a CEO for a while so our annual plan etc processes won’t really start in earnest until we’re at a certain size.
You can read our “Constitution” / Articles in the link
We’re “fundraising” now which is basically just issuing debt based on a negotiated interest rate and due date, so if you know anyone with 5k or more to spare that would be great. Obviously regular capitalist investors want nothing to do with us, which just makes it harder/slower and that’s ok.
I don’t want to see any company that I want to succeed making decisions like a democracy does today.
Obviously some deep reconsideration has to be done
My position is that democracy works well when the will of the people gets translated into action in a way that still resembles what those people organically need.
Marketing is the process of tampering with that translation such that what actually happens benefits the marketers' customers, typically at the expense of the people.
Presumably there are practices and technologies that we could invest in which preserve this translation, but we haven't been investing in those. Instead we've been investing in marketing. We're building a world where you can spend money to shape public opinion, and that's a world that's toxic to democracy.
Perhaps there was a time when information about available goods and services was hard to come by. Maybe you legitimately needed somebody to get the word out. But I don't think we live in that world anymore.
In case you're not familliar with "the shoe event horizon":
> As a society sinks into depression, the people of the society need to cheer themselves up by buying themselves gifts, often shoes. It is also linked to the fact that when you are depressed you look down at your shoes and decide they aren't good enough quality so buy more expensive replacements. As more money is spent on shoes, more shoe shops are built, and the quality of the shoes begins to diminish as the demand for different types of shoes increases. This makes people buy more shoes.
> The above turns into a vicious cycle, causing other industries to decline.
> Eventually the titular Shoe Event Horizon is reached, where the only type of store economically viable to build is a shoe shop. At this point, society ceases to function, and the economy collapses, sending a world spiralling into ruin. In the case of Brontitall and Frogstar World B, the population forsook shoes and evolved into birds.
That's what is happening to us, except instead of shoes, it's ads. We're diminishing the legitimacy of making a good product or being a good leader, because an easier way to win is just pay to shape public opinion.
What you win isn't as good as it would have been if you competed on merit, but that doesn't matter because competing on merit is hard and your opposition isn't doing it.
So I'm saying that it's Marketing vs Democracy and Marketing is winning. Thus we're living in Marketing's endgame and not Democracy's endgame.
For context, I just published a book called Insurgent Marketing. The central thesis is that the world is being shaped by propagandists, has been for a long time, and that the best (and most pragmatic) way to combat their influence is to play their game better than they do.
All businesses market themselves. Try running a business without doing anything remotely resembling marketing, and let me know how that goes. But that doesn't mean marketing (and marketers) should get a free pass for the damage many of us cause.
I think of marketing as neither positive nor negative in it itself, much like speaking or any form of communication. Some of us speak love. Some of us speak hate. Most of us spew garbage.
The problem isn't marketing, per se, but human greed. Both are as old as written history, and probably older. By blaming marketing, we excuse ourselves from taking responsibility of our role in shaping the world around us. The problem is "other people", those evil marketers. (Or politicians. Or bankers. Or the alt-right. Pick your bogeyman.)
Regarding this "Shoe Event Horizon", I hadn't heard of it before. My initial take is that as long as businesses keep getting bigger, quality will suffer. But we live in a time when it's easier (not easy, just easier) to launch a business of your own and produce shoes (or any product) of the quality you're looking for. Yes, most people will shop at Wal-Mart for the cheapest thing. Again, human greed, on behalf of both the corporation and the customers.
But thanks to technological advances, we're at a turning point where anyone with a smartphone can effectively market their goods. It's not the sole domain of corporations and governments anymore.
My hope, and my personal belief, is that more people will seize this opportunity so that we start to see an explosion of independent entrepreneurs producing products they're proud to stamp their names on.
I like where you're trying to go re: independent entrepreneurs. If that were the norm I'd likely have no bone to pick with marketing.
I'm skeptical, though, because I think that having 2x as much money doesn't just make you 2x better at shaping the narrative as the other guy, it makes you 4x better. So power concentrates in the hands of the few, and it's their misbehavior that I take issue with.
> By blaming marketing, we excuse ourselves from taking responsibility of our role in shaping the world around us.
If all we do is blame, then yes. But I don't really blame marketing. As you say, something like it has been going on forever. I blame technologists like myself for building the web in a way that that is so easily abused by marketers and propagandists.
I want to see a world where it's considered rude to share a link data that contains ads, or malicious javascript, or anything else with ulterior motives. Instead, you should strip the malware and share the cleaned version.
That's an unreasonable ask in today's web. Ain't nobody got time to re-host cleaned copies of everything they want to talk about. But in a content-addressed world, it's a little different, users have a bit more control over which version gets circulated.
So I'm trying to build a web where it's easier for users keep it clean and harder for outsiders to corrupt. It's slow going, practically everything root-of-trust is off limits (dns, ssl, ...), but at least it feels like meaningful work.
I can’t help that Google and Facebook track everything, but I CAN avoid using those aspects of their tools.
I like to target based on content, not user profiles. Google Search ads, for example. Yes, Google is absolutely building profiles on everything you click, but we don’t have to use their remarketing tools and the like. We can simply say “show my ads on related content” or “show my ads on related searches”.
Do most marketers do that? Absolutely not. But I’d like to think the tide is turning, if only because of the public backlash.
If you acquire multiple companies well then, fun times for you.
Court politics and C level politics are functionally very similar too.
It may look like that, but it's not true. You know how a good system administrator doesn't seem that important because he prevents all the fires that a bad one would heroically put out? The mere presence of a monarch, not even his actions, acts in a similar fashion. They don't have to actively govern the country, but they have emergency powers that would allow them to prevent a wanna be populist dictator. And because of obvious game theory implications, these powers never have to be used — their mere existence, and everybody bring aware of their existence, is enough for deterrence.
So I'll have to toss a citation needed on this one. I think history demonstrates a pretty strong overlap between those who support monarchs and populist dictators because in practice, they are structurally pretty similar.
Do you have any evidence that boards would not do this?
Can you give one or two examples?
For example, Baker, Bivens & Schieder (2019), "Reining in CEO compensation and curbing the rise of inequality", suggests that compensation for CEOs "is more likely to reflect CEOs’ close ties with the corporate board members who set their pay." https://www.epi.org/publication/reining-in-ceo-compensation-...
Bebchuk and Fried (2004), "The Unfulfilled Promise of Executive Compensation", is a literal book discussing it all; it suggests (amongst other things) that CEO remuneration is not always closely tied to company performance but can be influenced by peer benchmarking and the interdependence of corporate boards.
An old (1992) article in Management Review (V81, Issue 5) "Can we put the brakes on CEO pay?", contains suggestive ideas such as "Most CEOs have invited these people to be on board," Denton adds. "It's easy [for directors to be relatively generous.", so this is by no means a new situation.
And of course, veteran shareholder activist Rob Monks has been complaining about all this, and a lot more, for decades.
Lots of people want to be CEO (until they become CEO and until they make CEO kind of money)
By the first 3 months reality sets in and the person now in the CEO role understands that they are so far removed from the action that they are essentially relegated to the role of spokeperson and cheerleader, at maximum the role of general moving imaginary troops on a fictional battlefield.
If they can make peace with their role of political spokeperson and cheerleader they'd bail out as soon as they reach 5M net worth no debt. No less than 95% would bail out.
The remaining 5% would bail out once they reach 10M net worth no debt.
CEOs turnover and population is so low because it takes a special kind of monodimensional individual to have the world as your oyster 5-10M in your name and no debt and turn around and say "I'd rather go to work and pretend to be at the helm of an imaginary ship instead"
You are assuming here that boards are always acting in the best interest of the share holders. I bet there are many who do, but there are at least as many that act primarily in the interest of themselves. Board membership is a lucrative job without much supervision, if any at all. So nothing is keeping board members from taking it easy. Why rock the boat if this can make you known as difficult? You might not get that 2nd or 3rd board membership then anymore.
You might remember Credit Suisse, the major bank that had to be taken over recently by UBS to avoid bankruptcy: until then it had gone from scandal to scandal for 15 years in a row. 2 CEO's had been sent away in that period (by shareholders) but the president of the board? He could stay, and with him the rest of the board. His salary? 7 million a year.
The whole purpose of title inflation is to direct money to your friends with plausible deniability.
Now someone will bring up the rare cases where a CEO actually did something. That does not disprove the rule.