This is exactly it. When you're recruited (and you're always recruited - it's super rare to have a C-level position open on the website and submit a resume to) to a firm as an exec you have (generally) tremendous leeway to negotiate your own contract, exit criteria, etc.

Yes, the board provides a starting point, but it's much more collaborative negotiation - and you (as the incoming exec) are gonna negotiate based on the criteria I mentioned. It's not at all like an IC where you basically get a "take it or leave it, plus a few % more on salary if you push back" offer. It's a different universe.

Is it fair? I dunno. The "intrinsic value" argument doesn't really apply - the CEO is worth $10M/yr if the board thinks they are.

It's divide and conquer.

Engineers are too impressed by their own intelligence.

No, it's that we are too idealistic and are turned off by the messy, immoral greater world in which the management club makes their money. We want things to be beautiful and fair and so we spend our time constructing abstract fantasy lands in miniature.

The great irony, of course, is that the messy and immoral world intrudes even there because rational idealists can't find consensus and are subject to the biases that require conventions, institutions, politics and regulation just like the legal and business worlds.

If we were rational you might say we chose "playing with fun toys" over "controlling thousands of people and millions of dollars, and influencing millions of people and billions of dollars". Perhaps, for some people, that is indeed the rational choice if you don't really trust yourself.

I would love to hear more about what these behaviours are and how engineers could possibly adopt them.