CEOs beware: Your astronomical salaries may soon cost you customers

Re:CEOs beware: Your astronomical salaries may soon cost you... by Spooky23 on Saturday October 17, 2015 @08:47PM (#10406806)

Headcount isn't really relevant. My dad was a director (mid level manager) of a government org with something like 1,500 direct reports. He probably made the equivalent of $120k today. I think the salary differential between that gig and a line manager was 30-40%. I manage a big IT organization, manage a huge budget, 50 engineers. I make less than 5x the lowest paid employee. My boss's boss maybe 40% more than me.

The corruption of governance and a sense of entitlement fuels CEO salaries. End of the day, the CEO of WalMart doesn't deliver $35M of value. His decisions have big impact, but there are dozens of people who can make those decisions, and many could do so for far less.

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Re:CEOs beware: Your astronomical salaries may soon cost you... by glenra on Saturday October 31, 2015 @07:41PM (#10484719)

The average CEO makes about the same amount of money as the average dentist. When you get to the big scary numbers, you're talking about the top 100 highest-paid CEOs, not CEOs in general. Out of about a quarter-million CEOS around the country, a very very few of them are managing companies the size of Walmart and it's not at all obvious (at least, not to me) that those few are being overpaid.

> there are dozens of people who can make those decisions, and many could do so for far less.

Sure, or you could make the decisions by having a monkey throw darts at a newspaper for free. The important question is whether those dozens of people earning less would make as good decisions as the one currently doing the job. If the current CEO's decisions are even very slightly better he's worth the money given that level of scale.

Similarly, there are dozens of people who could play basketball for less so there was no need to pay Michael Jordan the big bucks.

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Re:CEOs beware: Your astronomical salaries may soon cost you... by brianclements on Monday October 19, 2015 @12:00PM (#10413718)

Curious what you think about why boards aren't incentivized to reign in CEO salaries. Is it because they all sit on each other boards?

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Re:CEOs beware: Your astronomical salaries may soon cost you... by Spooky23 on Tuesday October 20, 2015 @08:48AM (#10418794)

It's a small club, so there isn't an incentive to make waves.

Marissa Mayer is on the Walmart board. H. Lee Scott, former Walmart CEO is on the Yahoo board. Why would Mayer want to make a stink about the Walmart guy's salary, an awkward conversation that would probably lead to a similar awkward conversation when she wants a raise at Yahoo.

The boards that I've seen (at a smaller scale) that work are ones where there is a diversity of interests. The minority political party member making a stink about the majority in a town board. Or the company board where a representative of labor controls a key committee.

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