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Overpaid CEOs 2019

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Re: Overpaid CEOs 2019

#151

Post by skookumchuck »

LitFan wrote: post #115
skookumchuck wrote: post #104

Earlier quoted context omitted.

Oh pooh, I as a lower/middle class employee got a lot of stock options. They were worthless because the company stock sank, but I liked getting the options, and if the company had been managed better I would have made much bank. > I'd wager most lower income folks would take the money, since that's food on the table. Instant gratification is a large reason why lower income folks stay poor. (As for "food on the table"…

>(As for "food on the table", lower income people "invest" in lottery tickets. They clearly do have discretionary income.) Low income people are desperate to get out of their situation because in a lot of cases, it's barely livable. The information in the article shows that they're largely correct; A disproportionate amount of compensation goes to a small number of people - and that amount is so skewed that it can't…

> that amount is so skewed that it can't possibly be based on performance.

Of course it can be. I'll give another example - Microsoft under Gates/Ballmer/Nadella. As an MSFT shareholder, I am very, very happy with Nadella's results and he's worth whatever he's paid.

Re: Overpaid CEOs 2019

#152

Post by briandear »

dade_ wrote: post #132
davesque wrote: post #17

Earlier quoted context omitted.

Part of OP's point though is that CEO pay is apparently not tied to performance because CEOs still get astronomical pay really regardless of whether or not their company/division performs well. So CEOs just get paid more period. And there's this funny set of myths as to why that is the case. In reality, I think it just boils down to the fact that humans sort of instinctively (or maybe culturally?) like the idea of ro…

Correct. They get paid what they do because they set their own compensation. Performance has nothing to do with it, unless things get so bad they are removed.

CEOs of publicly traded companies don’t set their comp, the board does.

Re: Overpaid CEOs 2019

#153

Post by manigandham »

dade_ wrote: post #132
davesque wrote: post #17

Earlier quoted context omitted.

Part of OP's point though is that CEO pay is apparently not tied to performance because CEOs still get astronomical pay really regardless of whether or not their company/division performs well. So CEOs just get paid more period. And there's this funny set of myths as to why that is the case. In reality, I think it just boils down to the fact that humans sort of instinctively (or maybe culturally?) like the idea of ro…

Correct. They get paid what they do because they set their own compensation. Performance has nothing to do with it, unless things get so bad they are removed.

CEO's dont set their own comp unless it's a small private company, and those are unlikely to be paying millions.

Re: Overpaid CEOs 2019

#154

Post by briandear »

reb wrote: post #72
zdragnar wrote: post #16

Earlier quoted context omitted.

And yet, if you took Blizzard CEO's total pay (from the article, I think around $28 mil) and spread that over the nearly 10k employees, everyone gets an extra $3k, which wouldn't do diddly squat for retention. Also, losing 40% of growth would be pretty awful for anyone who has company stock (employees, 401ks, investors) especially if that's year over year.

The extra $3k might not mean a lot, but knowing your CEO gave $28m back to the workers at his or her own expense? I'd argue that kind of thing is great for retention. The challenge, obviously, is that CEO pay is a market and the current, insane pay scale has emerged from it. The only way for it to change would be a) regulation (good luck to the enforcers), b) a global moral awakening among CEOs that causes a sufficie…

> knowing your CEO gave $28m back to the workers at his or her own expense? I'd argue that kind of thing is great for retention.

If Tim Cook gave his entire comp back to the company, it wouldn’t be barely a blip on the paycheck. Cook leads over 130k employees and indirectly is responsible for several million more employees of suppliers; his comp has nothing to do with what people get paid. His salary is not even a rounding error compared to Apple and supplier revenues and the value of the company. They could double his pay and it wouldn’t even show up on the radar. Interesting, he doesn’t even have the top compensation at the company.

Re: Overpaid CEOs 2019

#155

Post by sammorrowdrums »

Mirioron wrote: post #142
maxxxxx wrote: post #84

Earlier quoted context omitted.

"I've always wondered what it would look like if were were paid in multipliers instead of salaries. The lowest would get 1x, middle folks 5x, and CEO maybe 20x. The usual "a rising tide lifts all boats" mindset." I like that idea!

Then you would get small companies and lose a lot of economies of scale. Would you rather be a CEO of a retailer of 100 employees or 1000000 employees? Your pay is going to be the same because cashiers in both companies will be paid roughly the same, meaning that maximum CEO pay will be the same. I guess it would be neat to see an immense amount of small companies though.

I too think it would be neat to see how it plays out.

I'd also like to propose in this scenario that the ownership of such companies could also apportioned out to staff, and that the government should create an environment where access to startup capital is cheaply available in all regions.

Consider how much more tax and local spending might occur. The problem with a lot of those economies of scale is that the companies and extremely wealthy individuals get quite good at reducing their tax burdens in inventive ways, especially once large enough to leverage international org structures.

And as you rightly point out upper management, are good at taking small cuts of profit from a much larger number of people, and the political leverage imbalance that this creates also really affects things (surely not one person believes an honest billionaire who gives frequent large donations to a party expects nothing in return).

Also a good chunk of that efficiency turns into lobbying and marketing budget.

I'm sure that there will still be companies that find a way to make extreme profit without large staff, and there would likely be other problems. But it's hard to believe it would be dramatically worse than the current state of extreme wealth imbalance.

Re: Overpaid CEOs 2019

#157

Post by nopzor »

mixmastamyk wrote: post #95
rayvy wrote: post #91

Earlier quoted context omitted.

Any more details (that you're willing to share) on this? You mentioned they're only the "Head of HR", but you say you were a core product dev (senior by the timeline you give). Did you accept underpay because you were early? I'm having a hard time wrapping my head around an 8-month "Head of HR" making out significantly better than a (first 20?) Sr Product dev (not questioning your story though).

Yes, what about vesting?

many companies have instant acceleration on change of control, with regard to the vesting point.

Re: Overpaid CEOs 2019

#158

Post by nopzor »

gradys wrote: post #99
roenxi wrote: post #55

Earlier quoted context omitted.

It is highly suggestive that CEOs are the ones who determine the pay of CEOs, in practice. If the shareholders actually had to negotiate the remuneration packages I bet the CEOs wouldn't be able to command the salaries that they do. There isn't enough evidence that paying more for a CEO increases profits. The upper middle management strata is stuffed with exceptional people and the skillset to be a good CEO isn't act…

Isn't CEO compensation generally determined by the compensation committee of the board?

at a large enough company with an independent enough board, sure. but these committees are largely driven by ceremony and politics under the guise of having to do with objectivity.

Re: Overpaid CEOs 2019

#159

Post by nopzor »

HaloZero wrote: post #85
CyberDildonics wrote: post #15

Reed Hastings founded Netflix and built it into what it is now, a dominant player in the entertainment industry. He did it through a long history of crafty, well planned technology and entertainment decisions. Not only this but he was able to build it up from so little and in such a small amount of time.

The average salary also seems to be $180,000 which is pretty good.

Not really a relevant metric imo

Re: Overpaid CEOs 2019

#160

Post by skookumchuck »

BookmarkSaver wrote: post #93
davesque wrote: post #17

Earlier quoted context omitted.

Part of OP's point though is that CEO pay is apparently not tied to performance because CEOs still get astronomical pay really regardless of whether or not their company/division performs well. So CEOs just get paid more period. And there's this funny set of myths as to why that is the case. In reality, I think it just boils down to the fact that humans sort of instinctively (or maybe culturally?) like the idea of ro…

I think any connection to "royalty" or anointed status is secondary and completely tied to individual executives and their performance (or at least reputation). What is true is the myth of individual efficacy. That a good CEO will have a successful company, and that a successful company is a sign of a great CEO. The reality is obviously that there are countless factors that affect company performance. It's not that p…

Yet the historical fortunes of many companies are clearly dependent on their CEOs. See Apple and Microsoft, for example.

It's much like how military battle outcomes are clearly dependent on the decision the general makes, for better or worse.

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