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Many companies aren’t prepared to replace underperforming CEOs

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Re: Many companies aren’t prepared to replace underperforming CEOs

#151

Post by sdiacom »

robotresearcher wrote: post #139
KerrAvon wrote: post #107

Earlier quoted context omitted.

I mean, we don't need to pay them that much. These obscene salaries weren't the norm a few decades ago. They're the end result of Reaganite tax policies failing to tax super-high-earners progressively.

You might think that paying a 45% marginal rate tax instead of 94% would mean you could be paid less while keeping more! How did lowering personal income tax increase compensation?

I imagine it's much easier for a CEO to justify divesting money from the company's profits to himself and to the government at a 1:1 ratio than it is at a 1:20 ratio.

I would posit that the CEO-to-government ratio acts, in a roundabout way, as a profit-to-pushback ratio. As a CEO, it may not be worth facing the board's reaction to spending two million dollars just so that you get an extra hundred thousand dollars.

Re: Many companies aren’t prepared to replace underperforming CEOs

#152

Post by missedthecue »

siva7 wrote: post #44
candiddevmike wrote: post #39

Earlier quoted context omitted.

I really think everyone under any manager/director/VP (directly or indirectly via skip levels) should be able to call a "vote of no confidence" and get them replaced with a majority vote. It's the only way to combat clueless leaders and raise issues like this.

corporations are not democratic institutions

In essence, they are. Shareholders elect board members who hire for important roles.

This is similar to democratic governments. In no democracy will voters elect the Minister of Energy or Transport or Defense or Labor or the foreign secretary. This is chosen by the elected officials.

Re: Many companies aren’t prepared to replace underperforming CEOs

#153

Post by naikrovek »

ok so what do CEOs do? hell, what does my manager do?

other than calendars full of meetings, I don't know what any manager does. as a technical person my entire career, the only things that my managers have ever done is to have regular meetings where we talk about non-work stuff, or they tell me that I am in trouble and/or fired.

the only thing that I know that they actually do is make technical decisions based on non-technical criteria, which makes for a very bad decision, in my experience.

I worked for a lawyer once who hired me to make technical decisions, and then made them himself anyway. "why are we spending so much money on rewriteable CD's?" well, you made an executive call and mandated that we archive documents to CD using uncompressed TIFF. so we get about 10 pages per disc. I told you not to do that but you said you knew what you were doing.

then it becomes my problem to fix while the lawyer screws off to some foreign beach.

Re: Many companies aren’t prepared to replace underperforming CEOs

#154

Post by simlevesque »

MichaelZuo wrote: post #121
zeristor wrote: post #104

Earlier quoted context omitted.

Sounds a bit like buying a commission, by having enough money you proved worthy of it.

It is quite similar, the most widespread usage historically would likely be the 18th century trading companies such as the British East India Company which used this method along with others to operate with a relatively tiny managerial workforce by modern standards. There was another post on HN a few weeks back with an article that looked into it and the numbers were really staggering.

if you could find it I'd love to read that.

Re: Many companies aren’t prepared to replace underperforming CEOs

#155

Post by gumby »

MichaelZuo wrote: post #121
zeristor wrote: post #104

Earlier quoted context omitted.

Sounds a bit like buying a commission, by having enough money you proved worthy of it.

It is quite similar, the most widespread usage historically would likely be the 18th century trading companies such as the British East India Company which used this method along with others to operate with a relatively tiny managerial workforce by modern standards. There was another post on HN a few weeks back with an article that looked into it and the numbers were really staggering.

Could you find that article, perhaps via algolia HN search? I didn't see it.

Re: Many companies aren’t prepared to replace underperforming CEOs

#156

Post by kennend3 »

BlargMcLarg wrote: post #122
kennend3 wrote: post #118

Earlier quoted context omitted.

Most strikes tend to be around : - More money - Better job security Like the one taking place here right now "On October 30, 2022, the Canadian Union of Public Employees (CUPE), issued a strike notice, after the Government of Ontario refused their demands for an 11.7% salary increase alongside other requests for improved working conditions." They are not after any "change" to how things are done, just a massive 11.7%…

I'm not trying to refute your point. You're allowed to be a little less aggressive. Point being strikes typically hit C-levels indirectly, not directly. A short term loss and display of collective power which could be avoided with foresight. Individuals are more often targeted through boycotting.

So in the case of CUPE asking for 11.7% increase in pay, who is the C-Level involved, and what is the "point" they are trying to make besides simply demanding more money?

How about this "strike"?

"The 2019 General Motors strike began September 15, 2019, with the walkout of 48,000 United Automobile Workers from some 50 plants in the United States. Demands by workers included increased job security, gateway for temporary workers to become permanent, better pay and retaining healthcare benefits."

what was the impact to the C-level? how did them demanding job security and better pay relate to them at all?

There is pretty much NO case of union action ever attempting to impact directly or indirectly a C-Level person.

They strike for Benefits, money, job security and that is about it.

Re: Many companies aren’t prepared to replace underperforming CEOs

#157

Post by DebtDeflation »

goopthink wrote: post #61

The company board’s sole job is to hire and fire the CEO when appropriate: https://reactionwheel.net/2021/11/your-boards-of-directors-i... However, having been on a team that prepares board materials and also having presented to a company board, I can tell you that the information they receive is extremely carefully managed in a way that allows responsibility to seem to flow downwards rather than upwards. What you se…

Many corporate boards have an "executive chairman" which means the CEO is also the Chairman of the Board. Perhaps even more importantly a substantial number of board members are executives from other companies, meaning CEOs sit on each others boards and wash each others' backs.

Re: Many companies aren’t prepared to replace underperforming CEOs

#158

Post by NohatCoder »

As best I can tell it is all one big boys' club. The network of CEOs who sit on one another's boards, are personal friends etc. is a pretty well connected graph.

When they hire, fire, negotiate wages and so forth a primary concern is exchanging favours. Why would a board member say no to granting a $100M payment package when it is a step on the way to getting a similar deal themselves some day?

Re: Many companies aren’t prepared to replace underperforming CEOs

#159

Post by gjm11 »

MichaelZuo wrote: post #121
zeristor wrote: post #104

Earlier quoted context omitted.

Sounds a bit like buying a commission, by having enough money you proved worthy of it.

It is quite similar, the most widespread usage historically would likely be the 18th century trading companies such as the British East India Company which used this method along with others to operate with a relatively tiny managerial workforce by modern standards. There was another post on HN a few weeks back with an article that looked into it and the numbers were really staggering.

A couple of people asked where this was. I think the article is

https://www.strangeloopcanon.com/p/some-things-to-learn-from...

and the HN discussion is

https://news.ycombinator.com/item?id=32710002

(but I am not MichaelZuo and it's possible that I've got the wrong thing).

Re: Many companies aren’t prepared to replace underperforming CEOs

#160

Post by lazide »

mkl95 wrote: post #18

One of the C-level guys at my current company should have been replaced a while ago. He ruins everything he touches but he's also one of the founders. There are virtually no processes for anything which makes him untouchable. Whenever he fucks up, some PM or low level manager is fired due to their "low performance". Is there anything non C-levels can do about it? Honestly I don't think so, all you can do is avoid the…

If he’s a co-founder, he probably has enough stake that no one is able to fire him, or there is no coalition of other owners large enough to do so that is tired enough of the antics to do so.

One of the privileges of ownership is being able to fuck yourself over by destroying your own stuff, after all.

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