Because otherwise they couldn't hire a good CEO. Unless the shareholders and the board are making bad hiring decisions.

We could also decide, as a society, that this is a problem; that the perverse incentives in place are harmful and change how companies are allowed to operate. For example, until the 90’s investment banks could only be general partnerships, meaning each banker was personally liable for the debt of the firm. What do you think that meant for how seriously they took underwriting risk? Similarly, law firms cannot sell stock and must only be owned by lawyers because society believes any other ownership structure would have a conflict of interest and harm clients.

You're right that we could collectively define new laws and rules. But what would they be?

Their are downsides to investment banks being private partnerships. On the other hand, I've talked with execs that wish the banks hadn't gone public. Yet they had strong incentives to go public.

> Because otherwise they couldn't hire a good CEO.

Yet they expect to hire good lawyers / engineers / team managers / janitors etc without such golden parachutes.

Why is the CEO position rewarded so greatly? Because the board comprises CEOs of other organisations.

They are the nobility of our era and look out for one another.

Maybe companies should filter CEOs based on their own confidence in their performance. I wouldn’t hire a sales person that wanted a large salary or guaranteed bonus; that means they don’t believe they will perform and earn a larger bonus.

The thing is they _didn’t_ hire a good CEO. This happened on his watch.

>The thing is they _didn’t_ hire a good CEO. This happened on his watch.

I guess nearly every US President and global leader, along with 80% of global CEOs aren't "good" either, because bad things happened on their watch. Some much, much worse than a data breach.

I'm not saying this guy was good, but that your standard is impossible to reach.

I disagree. The "this" that happened on his watch was not, in my opinion, that there was a breach, but rather the shitstorm about how it was handled - this happened on his watch and he did not handle it well and that is what makes him a bad CEO in my opinion.

Things happening isn't necessarily an indicator that the person is bad, but how they deal with it (in this case, he didn't for many months!) is an indicator. That's not an impossible standard to reach.

Well if CEOs aren’t responsible for the negatives they shouldn’t claim responsibility for positives.

Something tells me this guy had no problem collecting performance related bonuses.