Arf, Arf….this doggie believes we need to focus on other ways of recognizing our executives than just money and perks. After the first few million dollars, I believe that executives can be motivated by more compelling, values-based rewards. What if a CEOs performance – in addition to more modest monetary compensation – was recognized with greater contributions to his or her favorite not-for-profit cause, or by re-investing money into green technologies, healthcare and solving many of the other big challenges we are facing inside the US and other places in the world. I want to believe that people are ultimately good and that at some point in time executives would choose to be rewarded in ways different than just money. Is it possible that we will see more executives voluntarily taking cuts and realizing that they can live happy and fulfilling lives without the exorbitant compensation schemes that our system and culture have propelled. If not, I am afraid the only way to make meaningful change would be to look more regulation and progressive taxation squarely in the face……
Grrrrr…..I think executive pay has increasingly been getting out of whack, and some CEOs are coming around to the same conclusion. I just read an article —yes, for a dog I am pretty clever –about the CEO of Spokane-based education travel company Ambassador Group Inc. In 2008 the CEO took a voluntary pay cut of about 65 % in the face of an announcement to lay off 20% of its work force. And he is not alone. You will find that executives in many other parts of the world are as competent/or incompetent as our US executives, but maintain their motivation with more modest compensation schemes. This whole conversation ultimately boils down to personal values and a sense of collective responsibility for the woes and challenges of human kind. Correct me if I am wrong, but didn’t corporate American thrive several decades ago when compensation levels of CEOs and other senior executives were significantly lower (adjusted for inflation of course)? Ultimately I think what executives really care about goes beyond compensation: it’s things like working for a company with a cause they can relate to, with a leadership team they respect, with a CEO that cares….I hope this is the case and that we can start a journey as a country towards re-calibration, values re-alignment and culture change…..Absent a meaningful mission, money is a poor substitute. And, because it is a poor substitute, it just takes more and more of it….this conversation is making me really hungry…
Arf, Arf.. this debate has to do with a sense of equity and responsibility to not only yourself but all our fellow human beings, and I mean this in a global sense…. It just does not make sense to me that some people through the luck of the draw and no doubt hard work – but you will find some folks making minimum wage that work extremely hard as well – should be making the kind of money we see some executives make today. I think the same holds true for sports stars, film stars and others….oh, oh….wonder if this doggie I will get hate email now…. With all the huge problems we have as a society and in the world, we need to put our own desires for materialistic rewards and consumerism – some would call it greed – aside for the collective good of all. Hrmph……I am very hungry right now…thinking some chow would be good. While fifty bucks may mean nothing to a CEO making millions of dollars, it could mean several grocery bags of food and a huge difference for someone making minimum wage. And hey, a hungry dog like me could get 300 hot dogs for that amount of money…or kibbles for several months……mmmm!!!
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Well, I remember hearing a Yale Legal Ethics professor answer the question “What is your definition of ethical behavior?” He said “ethical behavior is doing more than you are required and less than you are allowed”. Doing the right thing means going beyond just playing by the rules. Yes, the game is about the dynamic interplay of greed and fear. Shareholders could take more responsibility for managing the collusion between CEOs and their Boards. We could do more to support the rights of workers to organize, refuse to buy stock in companies that are rewarding CEOs for ruining their companies in order to be fired and therefore qualify for their obscene severance packages. But, wouldn’t it be refreshing to have a CEO just take the high road, take to heart the lyrics of Keb Mo’s song “A better man”. Change the world one person at a time, starting with yourself.
Posted on May 28th, 2009 at 12:48 pm
I remember that some important human once said something to the effect that the thinking needed to get us out of the problems humans and their businesses created for themselves will need to go beyond the “business thinking” that was used to get them into those problems in the first place. Maybe Bosse’s friend Casey had a point… it’s possible that compensation managers (and their bosses!) need to look to developing alternative compensation systems sufficient to attract a different kind of executive than the “greed” based executives that have gotten us the failed lending practices, the bankrupt auto companies, the bailed out banks and insurance companies, that are at the core of our economic problems today. We hear so much about how you have to pay the going rate if you’re going to be competitive for the top talent. Seems like too many companies have been paying through the nose for anything BUT the top talent. What we need is a different type of talent, which would be attracted by a different form of compensation. Like Bosse said, after the first few million in annual compensation, another million or so becomes less relevant when compared to things like more romps on the beach, chasing sticks, a chance to dig for more bones, getting my stomach scratched by a friendly human, dock jumping, and garbage can sniffing. But then what do I know, I’m just a dog….
Scott
Posted on May 28th, 2009 at 1:59 pm
From MSN Money…
A $500,000 cap on CEO pay at banks that have taken billions in taxpayer money?
It’s not enough. “Off with their heads!” yelled Wonderland’s Queen of Hearts. Why isn’t there ever a bloodthirsty sociopath with dictatorial powers and no regard for legal niceties around when you need one?
And heads do need to roll. Not just to satisfy a widespread desire for revenge on the masters of the financial universe who got the world into this mess — although that’s certainly a plus. But because the greedy, shortsighted and, in some cases, downright crooked people must be punished this time. That includes everyone from middle-class speculators who lied to get mortgages they couldn’t afford to CEOs who took extreme risks because they thought they’d be out the door before the pyramid collapsed.
Posted on June 4th, 2009 at 9:35 pm
Citigroup is increasing base salaries of employees – by up to 50% – to offset restrictions on bonuses (note that Citibank is one of the companies that received bailout funds and face restrictions on bonuses as part of the the new government comp oversight plan. By making this shift in compensation it sounds like Citibank will continue to pay employees – incuding traders – as much as they received in 2008. They just don’t get it, do they?
Let’s hope that Obama’s “special master” Kenneth Feinberg stays on top of this one!!!
Posted on June 25th, 2009 at 5:34 am
Amazing! Actually, I think they DO get it Suzanne. And they are going to get it – the money they believe they should be paid.
Really, how can a new government compensation oversight plan be so simplistic as to not address total compensation? Another government plan, and more loop holes for people to figure out how to get around… All at the expense to the tax payers paying for a new government plan that does not and will not work.
Posted on June 28th, 2009 at 9:30 pm
My jaws ARE dropping: Goldman Sachs is on course to distribute bonuses that could rival the record paydays of the heady bull-market years:
http://seattletimes.nwsource.com/html/businesstechnology/2009471723_goldmanearn15.html
Poor former General Motors Chief Executive officer Rick Wagoner. He is ONLY receiving $8.5 million
http://seattletimes.nwsource.com/html/businesstechnology/2009471692_wagoner15.html
Posted on July 15th, 2009 at 9:41 am
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